Since the Sarbanes-Oxley Act provides many stipulations for a company and has large consequences for failure to comply, there is a greater demand for software to help ensure compliance with the SOX act. Some companies have had such difficulty with Sarbox that they have gone so far as to return to the private sector to avoid the hassle. This is where software can help a company traverse this piece of legislation.
The largest problem with the SOX act appears to be in revenue recognition. This refers to the way a company recognizes their revenue on their balance sheets. The SEC is forcing many companies to go back and restate their results to account for revenues differently. This can be a large hassle for a company and cause many problems with shareholders.
The software that has come available to help deal with the stringent SOX requirements helps companies to recognize revenue appropriately in a way that complies with SOX. These software programs are specifically designed with the SOX compliance rules so that reporting is done just as the law requires.
Complying with SOX can be a time consuming and expensive process which is why software programs to help have become so popular. SOX compliance software is designed to provide solutions for Governance, Risk and Compliance (GRC) problems.
Sarbox requires security measures as well. Fully compliant purchasing software programs can help with things like user authentication, password management, accesses, validation, exception reporting, logging, monitoring, alerts, application development, change management,and security audits. These are all required to know that a public company’s system is secure and monitored. By having all of these requirements on an IT department, the company is open to a great deal of risk. A software program to take care of these security measures for you is going to make it much easier to comply with SOX.
Compliance software can also do a great deal of risk analysis that is very beneficial in knowing your system and its security levels. This is a requirement by the SOX act and is accomplished much easier with a software program in place.
Since Sarbanes-Oxley is so demanding and the punishments for non-compliance are incredibly steep, it is important that all publicly traded companies are prepared and secure to ensure compliance with the Sarbanes-Oxley Act. Bellwether Software is SOX Compliant.
Be sure to download our whitepaper on SOX Compliance.
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