® sox overview mtac meeting august 7, 2008. the sarbanes-oxley act enacted in 2002 as a result of...
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SOX OverviewSOX Overview
MTAC MeetingMTAC MeetingAugust 7, 2008August 7, 2008
The Sarbanes-Oxley Act
Enacted in 2002 as a result of a series of large corporate financial scandals
Improves confidence in financial reporting by
– Promoting effective execution of controls
– Increasing corporate governance
– Reducing fraudulent practices and accounting inconsistencies
Paul Sarbanes
Michael Oxley
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What does SOX mean for the Postal Service?
We are the only federal agency required to comply with SOX
As a result of the Postal Act of 2006
– We began quarterly Section 302 certifications in February 2008
– We must comply with Section 404 of SOX by Sept. 30, 2010
– We must file with the Postal Regulatory Commission (rather than the SEC)
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Section 302 Certification
Certification included in reports 10-Q and 10-K
Under Section 302, the CEO and CFO must
– State that the financial statements fairly represent the financial position and results of operations of the Postal Service
– State their responsibility for establishing and maintaining effective disclosure controls and procedures
Broadens the current emphasis of integrity and completeness of controls relating to financial reporting
Section 404 Certification
Certification included in 10-K report annually beginning September 30, 2010
Under Section 404, the CEO and CFO must
– State their responsibility for establishing and maintaining an adequate internal control structure over financial reporting
– Make an assertion on the effectiveness of the internal control structure with regard to financial reporting
– Provide annual 404 certifications for fiscal year 2010 and beyond
Public accountant audits the effectiveness of internal controls over financial reporting
Impact of SOX
Communicating the importance of SOX to the organization
– Oversight Bodies
– All Hands Meetings
– Postmaster Conventions
– SOX Website
– Newsletter
SOX Timeline
FY 2007Prepare
Determine Materiality and Scope
Establish Steering Committee
Develop Communications &
Training Plan
FY 2008Document
Prepare Documentation
Identify Controls and Gaps
Initiate Gap Remediation
FY 2010Report
Test Controls
Update Documentation
Report and Certify
FY 2009Test
Continue Gap Remediation
Readiness Testing
Update Documentation
Benefits of SOX Compliance
Reinforce public trust in our financial reporting
Standardize and streamline processes and systems
Target areas of improvement and strengthen our business practices
Increase accountability and ownership of controls
Improve cross-functional support to solve challenges
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QuestionsQuestions
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