Sarbanes-Oxley Act Article Essay Example for Free

Sarbanes-Oxley exercise Article EssaySection 404 of the Sarbanes-Oxley ActThis article refreshen is on the article written by David S. Addington called Congress Should wind or Fix Section 404 of the Sarbanes-Oxley Act to Help Create Jobs. The Heritage Foundation published the article on September 30 2013. In the article, the author addresses concerns among companies staying in respect with Section 404 of the Sarbanes-Oxley Act. The author indicates that section 404 of the Sarbanes-Oxley act has caused a financial essence on companies. Companies spend a large amount of money to stay in compliance with the regulations on section 404 of the Sarbanes-Oxley Act. Furthermore, companies could use the money spent on auditing financial records to invest in more personal credit line lines and create more jobs (Additon, 2011).Section 404 of the Sarbanes-Oxley Act requires companies to include a statement of the responsibility of the company care for establishing and maintaining an a dequate internal visit structure and procedures for financial reporting along with their report filed with the Securities and Exchange delegacy (SEC). The annual report essential include an assessment of the effectiveness of the companys internal control structure and procedures for financial reporting, followed by having a registered macrocosm accounting firm attest on, and report on the assessment made by the management. This persuasion of the legislation requires companies to document important financial documents along with the reexamination from the certified public accounting firm it requires tremendous effort and large amounts of money for companies to comply with this aspect of the Sarbanes-Oxley Act (Additon, 2011). The author indicates that companies can use the money spent by companies to stay in compliance on other businesses lines creating more job opportunities and benefiting the economy. The author demands that Congress should examine whether section 404 is need ed, and if so, how to cut its pricy burden on businesses. Modifying or repealing section 404 of the Sarbanes-Oxley Act can free businesses to stimulate the economy (Additon, 2011). Businesses must stay in compliance with the law to operate efficiently at all times. Companies should stay in compliance to get the confidence and trust from investors.The 2012 Sarbanes-Oxley compliancy Survey listed where companiesstand on reviewing cost, time, efforts, processes to stay in compliance with the regulations. Approximately 35% of midsize organizations spend from $100,000 to $500,000 annually, and almost 80% spend $1 million or less. By year four of Sarbanes-Oxley compliance, most organization are spending $100,000 to $500,000 annually (2012 Sarbanes-Oxley Compliance Survey) this is relatively a small amount of money compared the total amount the company actually makes. The Sarbanes-Oxley act protects the public from unethical behavior by companies. If the government does not hold companie s accountable for their financing, it will lead to unconfident investors in the market if the public is not investing in businesses the economy will not be better. The take account the company pays to stay in compliance with the Sarbanes-Oxley Act is at the right price, achieving trust, and confidence from the public.ReferencesDavid S. Addington Congress Should Repeal or Fix Section 404 of the Sarbanes-Oxley Act to Help Create Jobs. The Heritage Foundation. September 30, 2011. Web. Retrieved from http//www.heritage.org/research/reports/2011/09/congress-should-repeal-or-fix-section-404-of-the-sarbanes-oxley-act-to-help-create-jobs 2012 Sarbanes-Oxley Compliance Survey. Retrieved from http//www.protiviti.com/en-US/Documents/Surveys/2012-SOX-Compliance-Survey-Protiviti.pdf