Compliance


COMPLIANCE
Research on material weaknesses among smaller public companies complying for the first time with Sarbanes-Oxley section 404 found that the highest number of missteps are related to accounting and disclosure controls.

A study by Lord & Benoit, a firm specializing in SOX compliance, identified what it described as the 10 leading material weaknesses among 148 companies with revenue of less than $100 million. Companies with effective internal controls were excluded from the study.

Nearly two-thirds of the companies with material weaknesses had issues linked to accounting and disclosure controls, including inadequate or inaccurate financial statement disclosures and departures from GAAP. Other leading problem areas included:

Treasury
Competency and training of accounting personnel
Control environment
Design of controls/lack of effective compensating controls
Revenue recognition
Financial closing process
Inadequate account reconciliations
Information technology
Consolidations, mergers and intercompany accounts

SPONSORED REPORT

Tax reform changes are now in effect

With all the recent tax law changes, this year it’s more important than ever to make sure your clients’ tax situations are squared away before year end. This report provides necessary guidance to ensure 2019 starts without a hitch.

PODCAST

Using drones to enhance audits

Hermann Sidhu, CPA, global assurance digital leader at EY, walks us through EY’s exciting new project to use drones to help audit large warehouses and outdoor inventories.