Sarbanes-Oxley Act (SOX)
Section 406 of Title IV
Dictates that each issuer disclose whether or not they have adopted a code of ethics for senior financial officers. Any change in or waiver of the code of ethics for senior financial officers requires immediate disclosure.
Section 409 of SOX Title IV
Dictates that issuers disclose to the public on a rapid and current basis any additional information concerning material changes in the financial condition or operations.
Section 105 of SOX Title I
Dictates that the Public Company Accounting Oversight Board (PCAOB) may investigate any act or practice, or omission to act, by a registered public accounting firm that may violate any provision of the Sarbanes-Oxley Act, PCAOB rules, securities laws, and professional standards.
The Securities Act of 1933
Exists to provide information to investors about securities offered for sale. It requires all those firms who are not exempt to register before selling their securities, and for those associated with the registration statement to take responsibility for the accuracy of the registration.
The Sarbanes-Oxley Act of 2002, Section 206
Explains that it is unlawful for a member of an audit engagement team to accept employment as a chief executive, chief financial or chief accounting officer, or controller of an audit client that files reports with the Securities Exchange Commission during the 1-year period preceding the date of the start of the audit.
PCAOB Rule 3524
Requires the registered public accounting firm to describe in writing the scope and fee structure of the services, discuss potential effects on independence, and document the substance of the discussion with the audit committee.
Title I of the Sarbanes-Oxley Act of 2002, Section 102
public accounting firms performing audits for issuers must register with the PCAOB. The registration includes
Securities Exchange Act of 1934
Created the SEC
PCAOB Rule 3522
Prevents registered public accounting firms from marketing, planning, or opining in favor of tax treatment of a transaction.
The Sarbanes-Oxley Act of 2002 (SOX)
Also known as the Public Company Accounting Reform and Investor Protection Act, was enacted to develop new or enhanced standards for all U.S. public company boards, management, and public accounting firms.
Section 407 of SOX Title IV
Dictates that each issuer disclose whether or not the audit committee is comprised of at least one member who is a financial expert.
Title III, Section 303
Prohibits any officer or director from taking any action to fraudulently influence, coerce, manipulate, or mislead any independent public or certified accountant engaged in the performance of the audit of the financial statements of the issuer.
Section 403 of SOX Title IV
Requires disclosures from a person who is directly or indirectly a beneficial owner of more than 10% of any class of any security registered pursuant to Section 12 of the Securities Exchange Act of 1934.
Section 404
Requires that an internal control report be filed with each annual report. Management must acknowledge responsibility for establishing and maintaining adequate internal control.
Disclosures of Transactions Involving Management and Principal Stockholders
Section 403 of SOX Title IV
"Disclosures of Audit Committee Financial Expert"
Section 407 of SOX Title IV
"Real Time Issuer Disclosures,"
Section 409 of SOX Title IV
Financial experts
have an understanding of GAAP and financial statements, are experienced in the preparation or auditing of financial statements and the application of accounting principles, are experienced with internal accounting controls, and have an understanding of audit committee functions.
Section 402 of Title IV
dictates that it is unlawful for any issuer to extend or maintain credit in the form of a personal loan to or for any director or executive officer of that issuer.
