Cash and Asset Management Implementing strategic methods to safe guard company cash and assets is vital to maintaining a successful business. You are required to research the internal control...

Introduction
SOX Act is a milestone in the history of United States for safeguarding the interest of investors from the fraudulent activities of the big corporate houses by making strict rules and regulations. It ensures proper internal controls and fair and true financial disclosures of information on the part of corporate houses. It highlighted the importance on internal control for managing companies in a better way and also keeping check on activities of the employees. The responsibility of same is imposed on the high corporate officers who are held responsible and provision of strict punishments is also introduced through the various sections of the act. Big corporate organizations should their selves implement new and innovative internal control measures. This will result in keeping all things on their places and also help in gaining the trust and faith of the investors and the compliance with the legal procedures of various acts also become easy. Regular auditing of internal control should be done and if there is any problem in their implementation, strategies can be developed to cope up with those issues. Assets especially cash would be managed in a better way by proper controls. Proper utilization of all the assets is ensured through the process of internal control.
What Is Sox Act?
The SOX act which is also termed as Sarbanes-Oxley Act, Sarbox, Public Company Accounting Reform and Investor Protection Act, Corporate and Auditing Accountability and Responsibility act was enacted on July 30, 2002. The aim of act is to improve accuracy and reliability of corporate disclosures to protect investors from the fraudulent financial reporting of big corporate houses. It amended or strengthens the rules and policies of existing laws that deals with security listing and regulating. Reforms is also brought in the areas of accounting regulation, corporate responsibility , new protection measures and increasing criminal punishment in case of violation of laws. The act aimed at winning the trust of the public back in financial markets of US that was lost due to various scandals.
It is United States federal law which defines new standards for the public companies of United States. This act contains 11 sections or titles and Securities and Exchange Commission has held responsible for implementing the rules to comply with the new law.
Major Provisions of the Act
Sec 302: It requires that the senior officer of the corporate have to ensure and certify that all the SEC disclosure requirement are met in the financial presentation of statements and all the information is presently fairly. If any of these officers are found guilty later on then strict criminal penalties would be imposed on them.
Sec 404: This section ensures that auditors should establish internal control in the organizations and reporting systems. Auditing of these controls should be done periodically to found bottlenecks in the internal control system if any.
Sec 802 defines rules for book keeping. The first set of rules related to falsification of records. Second set defines retention period required for storing records. Third set deals with specifying business records that need to be stored by corporate houses for ensuring.
History of the Act
This act is emerged as a result of various accounting and corporate scandals during 2000-2002 which lead to loss of public confidence in financial markets and public companies of US. The major scandals from all are Enron, Global Crossing, Tyco, Worldcom, Adelphia. Apart from these scandals other reasons behind the emergence of act was auditor conflict of interests, securities conflict of interests, loopholes in banking practices, board failures, and inadequacy of funds to SEC for framing policies and regulation activities etc.
On April 24, 2002 Rep. Oxley bill was presented by Michael Oxley passed in the House. The act is...