|  | | 2004 News and Press Releases | | |
HEADLINE NEWS:
Sarbanes-Oxley Deadline Looms Like A Corporate Compliance Y2k
Patrick F. Gannon – Miami Daily Business Review
Law.com. December 23, 2004
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EXCERPT: Remember when the millennium bug was all over the news? Companies struggled and sweated and spent big bucks to get their computer systems in order before New Year's Eve 1999. At first, I wondered why I should care. It didn't seem like it would affect an average American -- until the warnings started: "Get your money out of the bank before Dec. 31, or it may vanish overnight." Seems like 1999 all over again when you read today's Sarbanes-Oxley §404 stories. Public companies are now required to assess their internal controls and have the reports certified by their auditors -- and many may miss their deadlines. Recently, dozens of companies each month began disclosing some inadequacies in controls. On Nov. 30, the Securities and Exchange Commission, responding to concerns about missed deadlines and control problems, granted a 45-day reprieve for a certain group of companies. These companies, about a third of South Florida's public companies, now have a little extra time to comply. WHY YOU SHOULD CARE If you're like half of Americans, you're an investor. The Sarbanes-Oxley Act of 2002 was Congress' reaction to the recent corporate fraud stories -- Enron, WorldCom and the others. The act's requirements are intended to protect investors from unreliable financial reporting through new requirements for company boards, audit committees and even their watchdogs, the auditors. Section 404 of the act, known as SOX 404, requires companies to assess and report on the effectiveness of their internal financial controls, and it requires their auditors to audit the findings. Does this protect investors? It should. Without the proper controls, companies are in danger, and so is your investment. The right controls help guard against everything from employee theft to management misstatement of financial information. |
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