| What is the
Sarbanes-Oxley (SOX) Act of 2002?
Following the bankruptcy of
Enron in 2001, Congress responded to heightened public concern
about corporate integrity and accounting firm irregularities by
passing the Sarbanes-Oxley Act of 2002 on July 30, 2002.
The law's provisions are
generally intended to:
- Establish greater
independence between public accounting firms and their audit
clients;
- Remove incentives for
management misrepresentation of the corporation's financial
condition;
- Provide sanctions for
corporate/accounting firm misconduct;
- Establish oversight of the
accounting practice.
Section 404 of SOX has the most
relevance to HR/Payroll functions. Simply put, Section 404
requires companies to establish, maintain and evaluate an
adequate internal control structure related to financial
transactions and financial reporting and report on its
assessment of internal controls on an annual basis. Companies
must also identify the framework used to assess the
effectiveness of the internal controls.
Why is Section 404 relevant
to HR/Payroll functions?
SOX compliance requirements can
have a major impact, not just on Finance and IT but also on the
Human Resource function. People costs usually represent an
organization's largest expenditure, and major opportunities
exist to make HR business processes more consistent, reliable,
and efficient, especially in the context of Section 404
requirements for sound internal controls.
How does Sage Abra HRMS help
companies comply with SOX Section 404?
Sage Abra HRMS helps achieve
and maintain regulatory compliance by automating processes,
maintaining accuracy and security of data, managing risks
related to fines and legal exposures, and tracking the
completion of certifications and other critical training.
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Where can I learn more about
SOX?
Here are a couple of good
websites that contain information about the Sarbanes-Oxley Act
of 2002:
http://www.sec.gov/spotlight/sarbanes-oxley.htm
http://www.sarbanes-oxley-forum.com/index.php |
