|  | | 2004 News and Press Releases | | |
HEADLINE NEWS:
The High Cost Of Sarbanes-Oxley: The True Cost Of Compliance Is Just Beginning
CreditCollectionsWorld.com. November 1, 2004
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EXCERPT: Since the Sarbanes-Oxley Act passed in 2002, publicly held lenders and creditors have scrambled to add the technology needed to help them meet an end-of-year 2004 compliance deadline. As the date nears, they're discovering that the mammoth and high-cost venture has only just begun. For most bound by Sarbanes-Oxley, compliance means a brute force implementation of software solutions needed to create the audit trail and data verification processes required under the legislation. But where brute force implementation occurred, the information technology systems making up the backbone of an institution's business haven't necessarily been revamped. To prevent their compliance strategies from being shortsighted, many lenders and creditors are using Sarbanes-Oxley as the impetus for taking a harder look at how their IT infrastructure impacts their business strategy. Subsequently, many lenders and creditors are expected to leverage Sarbanes-Oxley to refine their core IT infrastructures in 2005, hoping to create greater operating efficiencies. "The investment to comply with Sarbanes-Oxley and other regulatory guidelines is just beginning," says Virginia Garcia, a senior analyst for TowerGroup, a Needham, Mass.-based research firm owned by MasterCard International. "There are other sections within Sarbanes-Oxley that build on the requirements for internal controls" and will hasten the push to revamp core IT infrastructures.
Sarbanes-Oxley was passed by Congress to reform the accounting procedures used by publicly traded companies and to protect investors from a misstatement of earnings that, in a worst case scenario, can render their holdings in the company worthless. |
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