News & Insights

Exploring Section 404 of the Sarbanes-Oxley Act of 2002

Introduction to Title IV of the Sarbanes-Oxley Act (SOX) The Title IV of SOX is comprised of 9 provisions, in which the primary focus is to improve financial disclosures. Section 401 of the law necessitates that companies should provide financial statements that adhere to GAAP and shows “all material correcting adjustments established by the auditing firm.” In addition, financial reports produced quarterly or annually must report “all material off-balance sheet undertakings, arrangement obligations, and other relationships with unconsolidated entities that have an impact or eventual impact on the financial health of the issuer.” In so doing, the Securities and Exchange…

Basics of Sarbanes-Oxley Act of 2002

Historical Timeline of Laws that Precedes Sarbanes-Oxley Act of 2002 In 1911, Kansas enforced a comprehensive securities law in response to agents that sell interests that had no financial backing. Several years down the line, the 1929 market crash acted as the turning point for the institution of preventive measures on business proceedings. Consequently, the Securities Act of 1993 was enacted. Through this, investors were required to thoroughly disclose their financial information and were prohibited from engaging in shady, fraudulent, and misleading business transactions, which involved securities. The implementation of the Securities Exchange Act of 1934 resulted to the formation…

Career Paths in Accounting

According to statistics by the U.S. Bureau of Labor Statistics, the need for auditors and accountants will increase by 18% between 2006 and 2016. This makes accounting one of the fastest growing professions in the country.It is often perceived that the accounting profession has a good deal of qualified members. However, in today’s world, accounting is more than just arithmetic. Professionals in this field are involved in an array of activities such as: preparation of financial statements, documenting business proceedings, calculating costs and efficiency gains from new technologies, engaging in mergers and acquisitions planning, as well as expanding and utilizing…

U.S. Accounting: Before, Now, and the Future

Accounting has been a part of our everyday lives, perhaps since the beginning of time. During the seven years of prosperity, as recounted in the Bible, it is believed that someone made an inventory of the gathered food and received money all throughout the seven years of aridity and death in Egypt. Contemporary accounting techniques and measures were being utilized as far back as even during the time of the American Industrial Revolution in the 1800’s.Formal U.S. accounting may have started when the American Association of Public Accountants (AAPA) was established in 1887. The certificates issued by the organization were…

Understanding Balance of Stockholders’ Equity

Brief Review of the Balance Sheet The balance sheet sums up the financial health of an entity at a specific financial period by detailing its assets, liabilities, and equity. By comparing and contrasting the beginning owners’ equity with the ending owners’ equity, the user of the financial statement will know if the capital for that accounting period was expanded or abated. According to the Financial and Accounting Standards Board, the items to be reported on the balance sheet, and in any other financial statements, must be measurable, relevant, and reliable. The balance sheet contains three elements: assets, liabilities, and stockholders’…