Are your assets properly labeled and classified? Do you have an accurate inventory of all your physical assets?

If not, you may be in violation of the Sarbanes-Oxley Act.

What is Sarbanes-Oxley?

The Sarbanes Oxley Act of 2002 has had a major impact on the level of disclosure required by public companies. It requires significant improvements to the overall monitoring and internal scrutiny of public companies’ corporate governance processes and financial reporting processes.

What is Required?

Publicly held companies have faced increased requirements for more accurate audit standards and internal controls on their fixed assets and their values. The act requires every transaction to be available for analysis and reporting. This includes the purchase and sale of assets. Though traditionally, many companies did not assign high priority to maintaining detailed, auditable records on fixed assets, this legislation changes the rules. Tracking fixed assets is now a critical part to every publicly traded company’s financial reporting.

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