Category: General

Implications of Section 404 of the Sarbanes-Oxley Act

Adequate Internal Control Over Financial Reporting The provision under Section 404 of the Sarbanes-Oxley Act is considered to be the most controversial and the most challenging part of the Act. Section 404 obliges the external auditors and their client firms to disclose the efficacy and adequacy of the company’s internal control over financial reporting. Implementing Section 404 is not all about compliance. For the most part, realizing the regulations and policies under the provision will provide significant benefits to the company. These include enhanced effectiveness and competence of internal control practices, increased investor confidence, and more thorough information for investors.…

Implications of the Sarbanes-Oxley Act of 2002

Review of the Sarbanes-Oxley Act of 2002 In July 2002, the Sarbanes-Oxley Act (SOX) of 2002 was enacted in order to restore confidence in corporate financial statements. This was in response to the series of financial scandals that erupted involving large corporations and accounting firms. Under SOX, accounting firms, public companies, registered foreign corporations, and specified private companies are required to comply with the requirements and rules as sanctioned by the law. In most cases, the auditors were criticized and blamed for having a conflict of interest. Investigations showed that their income far exceeded what was supposed to be the…

Understanding the Dodd-Frank Wall Street Reform and Consumer Protection Act

The Dodd-Frank Wall Street Reform and Consumer Protection Act or simply Dodd-Frank Act, is regarded as the most extensive financial reform since the rescinding of Glass-Steagall Act. Referred to as the Banking Act of 1993, the Glass-Steagall Act was legislated in order to avert the use of depositors’ funds by banks on precarious ventures like the stock market. In a manner similar to the Glass-Steagall Act, the Dodd-Frank Act aims to monitor and supervise financial markets so that financial crises such as the 2008 economic crunch won’t happen again. In addition, the Act is tailored to protect consumers through its…

The Patient Protection and Affordable Care Act

The Patient Protection and Affordable Care Act (ACA) is said to be the most comprehensive reform on the U.S. medical system for the last 45 years. According to a paper from the Department of Economics of Massachusetts Institute of Technology, the ACA will revolutionize the non-group insurance market in the country, substantially expand public insurance, and subsidize private insurance coverage. Further, it will  increase the federal income from a variety of new taxes, as well as curtail and restructure spending under Medicare. The ACA Also referred as Obamacare, the ACA is comprised of the Affordable Health Care for America Act,…

2016 Year End Tax Strategies for Individuals and Businesses

As the end of the year approaches, it is a good time to think of planning moves that will help lower your tax bill for this year and possibly the next. Factors that compound the planning challenge this year include turbulence in the stock market, overall economic uncertainty, the new Trump administration, and Congress's all too familiar failure to act on a number of important tax breaks that will expire at the end of 2016. Some of these expiring tax breaks will likely be extended, but perhaps not all, and as in the past, Congress may not decide the fate…