Sox Act - Dorman PDF

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Shaun Martin Ed Dorman ACCT 202-005 1 September 2016 Chapter One – Sarbanes-Oxley Act of 2002 In the years leading to 2002, many businesses, small and large, were partaking in corporate accounting scandals. The Sarbanes–Oxley Act was created in response of said scandals, and was aimed at not only improving corporate trustworthiness, but accountability from the structural ladder as well. The SOX Act was named after its co-sponsors, U.S. Senator Paul Sarbanes and U.S. Representative Michael G. Oxley. The act contains eleven titles, or sections, ranging from the addition of corporate board responsibilities to more severe criminal penalties, and requires the Securities and Exchange Commission (SEC) to implement said penalties if these corporations do not comply with the law. Section 802(a) of the SOX Act states that “whoever knowingly alters, destroys, mutilates, conceals, covers up, falsifies, or makes a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence the investigation or proper administration of any matter within the jurisdiction of any department or agency of the United States or any case filed under title 11, or in relation to or contemplation of any such matter or case, shall be fined under this title, imprisoned not more than 20 years, or both.” Along with the financial and accounting aspects that the SOX Act

effects, it also shines a light on the computer and information technology side of a corporation and the documents those computers hold. This Act is not putting a stress on how a business should store their records, however, it requires certain types of records for a specific amount of time to be stored. The Act states that records should not be saved for any less than five years, and going against this would result in fines and/or imprisonment. Many companies have been created to help other organizations comply with the SOX Act. Workiva Inc., for example, is one of those companies. It is credited with providing a cloud-based platform program of productivity that links data while building internal controls across large global enterprises. On June 7, 2016, Integrated DNA Technologies, Inc. announced that it was using Workiva's “Wdesk” platform to help it comply with the SOX Act. There are three rules stated in the Sarbanes–Oxley Act about the management of electronic records. The first rule deals with the destruction, alteration or falsification of records, and the penalties resulting from having practiced those ways. The second rule defines the retention period for records storage. It is best indicated that corporations will securely store all business records using the same guidelines set for public accountants. The third rule refers to the type of business records that need to be stored, including all business records and forms of communication, including electronic communications. The Sarbanes–Oxley Act has been praised for creating a more accepted and nurtured ethical business culture as it forces top management level employees to be transparent and every single employee at their companies to be responsible for their acts while protecting whistleblowers....