Audit committees, boards of directors, and remediation of material weaknesses in internal control
The Sarbanes-Oxley Act (SOX) was passed in 2002 in response to a series ofaccounting improprieties at well-known companies such as Enron and WorldCom.One important aspect of SOX is the internal control requirements. SOX section302 requires that management evaluate the effectiveness of disclosure and...
Saved in:
| Main Author: | |
|---|---|
| Format: | text |
| Language: | English |
| Published: |
Institutional Knowledge at Singapore Management University
2009
|
| Subjects: | |
| Online Access: | https://ink.library.smu.edu.sg/soa_research/127 https://ink.library.smu.edu.sg/context/soa_research/article/1126/viewcontent/acav_causality_icse24.pdf |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| Institution: | Singapore Management University |
| Language: | English |
| Summary: | The Sarbanes-Oxley Act (SOX) was passed in 2002 in response to a series ofaccounting improprieties at well-known companies such as Enron and WorldCom.One important aspect of SOX is the internal control requirements. SOX section302 requires that management evaluate the effectiveness of disclosure and controlprocedures, report results of the evaluation, and indicate any “significant changes”in internal controls since the last 10-K or 10-Q report (Securities and ExchangeCommission [SEC] 2002). In addition, SOX section 404 requires that manage-ment’s assessment of the effectiveness of internal control over financial reportingand auditors’ attestation on management’s assessment be included in firms’ 10-Kreports (SEC 2003a). The heightened attention to internal control can enhance thereliability of financial statements by helping companies to identify internal controldeficiencies and remediate these deficiencies in a timely manner (Charles RiverAssociates 2005). |
|---|