WELCOME AUDIENCE

BRIEF ON Sarbanes-Oxley Act,2002

HISTORY In order to gain the confidence and trust of the public over companies, the Sarbanes-Oxley Act is introduced. Michael Oxley and Sarbanes are the thinkers of the Act. As there were differences between Oxley and Sarbanes, a committee appointed to overcome differences and finally adopted the Sarbanes-Oxley Act in 2002.

OBJECT OF THE ACT Protect the investors through accuracy and disclosures

ADDITIONAL POWERS TO SEC The Sarbanes-Oxley Act also known as . SOX or SarbOx The Act designed to review legislative and audit requirements. More particularly additional powers have been entrusted by the SOX to the U.S.Securities and Exchange Commission.

APPLICABILITY The SOX is applicable to all public companies in the United States. It is also applicable to international companies who have registered equity or debt securities with the Securities and Exchange commission. the accounting firms who are providing audit services to such companies also come under the purview of Sarbanes-Oxley Act.

CEO AND CFO LIABILITY The Act intended to secure financial disclosures to prevent accounting fraud in the corporate sector. Accordingly the Act created new standards for corporate accountability and also provided penalties for wrongdoing in the sector. Therefore, the CEO and CFO cannot escape from the liability for non complying the accuracy in financial statements.

Public Company Accounting Oversight Board As per the recommendations of Act, Public Company Accounting Oversight Board is established for which the Securities and Exchange Commission will oversee the issues of pubic accounting firms and accounting standards.

COMPLIANCE The Sarbanes-Oxley Act consists of 11 Titles. As far as disclosures by the companies, they must be aware with the sections of 302, 401, 404, 409, 802 and 906.

USE OF OUTSOURCING OF INTERNAL AUDIT The company should not use internal audit work through outsourcing from the External Auditors of the company which is specified under Section 404 of the Act

PENALTIES The CEO and CFO liable for wrong certification and the Act also attached penalties and imprisonment- up to $1 million and up to 10 years There will be more penalty and imprisonment for willful wrong certification – up to $5 million and up to 20 years

THANK YOU I am very thankful for the audience and also offer any clarification about the presentation