PracticeConsultingSoftware offered to tackle Sarbanes-Oxley

Software offered to tackle Sarbanes-Oxley

Companies are being offered a range of products to help comply with Sarbanes-Oxley as lawyers warn not every business will be prepared in time.

The Act will affect the storage of a company’s electronic records as well as its finances. And although UK subsidiaries of US corporations may not be directly affected, they will have to ratify the integrity of the data and reporting that they share with their US parent.

Rick Mitchell, partner at US law firm McDermott, Will & Emery said the risks to dual-listed UK companies from Sarbanes-Oxley should not be dismissed.

‘All relatively large companies will be affected. A British company with a NYSE listing that has trouble with reporting from its Indian office, for example, will have to be very careful,’ he said.

Mitchell said many companies would not be ready in time because their budgets were focused on costs other than accounting and data compliance.

But the law includes penalties of up to 20 years in prison for chief executives and chief finance officers and fines of up to $5m (£2.9m) per violation, per person.

The new levels of compliance will lead to major changes in the way companies store and re-use data, and IT vendors are seeing this as a new market.

Suppliers are offering a range of products and services that help companies comply with a series of new regulations. A US survey by IBM found only one in 10 financial executives thought their internal controls were compliant with Sarbanes-Oxley.

‘There is a lot of convergence between Sarbanes-Oxley, operational risk with Basel II and the Patriot Act and general business performance. A single framework can now cover compliance and identify business process efficiencies,’ said Pierre Pourquery IBM global head of risk and compliance for financial services.

Some companies would weigh up the cost of withdrawing from Nasdaq and NYSE listing against updating their IT systems, he said.

Related Articles

5 tips for SMEs to protect cash flow

Accounting Software 5 tips for SMEs to protect cash flow

3m Alia Shoaib, Reporter
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

9m Stephanie Wix, Writer
Managing partner Q&A - the year ahead: Richard Toone, CVR Global

Accounting Firms Managing partner Q&A - the year ahead: Richard Toone, CVR Global

10m Kevin Reed, Writer
Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

Audit Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

11m Kevin Reed, Writer
New head of equity capital markets for KPMG

Accounting Firms New head of equity capital markets for KPMG

11m Stephanie Wix, Writer
Deloitte 'self-imposes exile' on government contracts to defuse PM row

Accounting Firms Deloitte 'self-imposes exile' on government contracts to defuse PM row

10m Kevin Reed, Writer
Managing partner Q&A - the year ahead: Julie Adams, Menzies

Accounting Firms Managing partner Q&A - the year ahead: Julie Adams, Menzies

10m Kevin Reed, Writer
Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

Business Regulation Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

10m Kevin Reed, Writer