What is Section 406 of Sarbanes-Oxley?
Section 406 of Sarbanes-Oxley instructs the SEC to issue rules requiring a public company to disclose whether or not (and if not, why not) the company has adopted a code of ethics for its senior financial officers.
What is Sarbanes-Oxley SOX requirements?
SOX requires formal data security policies, communication of data security policies, and consistent enforcement of data security policies. Companies should develop and implement a comprehensive data security strategy that protects and secures all financial data stored and utilized during normal operations.
What are the sections of SOX?
SOX contains 11 sections, called “Titles” in the legislation, as follows:
- Title I: Public Company Accounting Oversight Board.
- Title II: Auditor Independence.
- Title III: Corporate Responsibility.
- Title IV: Enhanced Financial Disclosures.
- Title V: Analyst Conflict of Interest.
- Title VI: Commission Resources and Authority.
Why is Section 406 of the Sarbanes-Oxley Act of 2002 important to senior financial officers whose companies are listed on a US stock exchange?
Section 406, which directs us to adopt rules requiring a company to disclose whether it has adopted a code of ethics for its senior financial officers, and if not, the reasons therefor, as well as any changes to, or waiver of any provision of, that code of ethics.
Which section of Sarbanes-Oxley requires a code of ethics for senior financial officers?
Section 406
Sarbanes–Oxley Section 406 requires a code of ethics for top financial and accounting officers in public companies.
Which section in Sarbanes-Oxley addresses internal control structure?
Sarbanes–Oxley Section 404: Assessment of internal control. The most contentious aspect of SOX is Section 404, which requires management and the external auditor to report on the adequacy of the company’s internal control on financial reporting (ICFR).
What does the Sarbanes-Oxley Act Sox of 2002 prohibit what does Sox require from the board of directors?
The Sarbanes-Oxley Act changed management’s responsibility for financial reporting significantly. The act requires that top managers personally certify the accuracy of financial reports. The Sarbanes-Oxley Act imposes harsher punishment for obstructing justice, securities fraud, mail fraud, and wire fraud.