Big4Guy

Disclosure Controls as such is broad term which incorporates internal controls over financial reporting. I discussed in one of my earlier posts, the concept of disclosure controls. Disclosure controls and procedures are designed to ensure that all material information in an organization is accumulated and summarized so that management can make an assessment of controls based on the requirements of SEC. Section 302 of the Sarbanes Oxley act requires the certifying officers to perform evaluations of internal controls and procedures before the annual report under Section 404 is submitted to the SEC.

Certfying officers need to evaluate the disclosure controls at least 90 days prior to the filing date of report to SEC. It makes sense to perform such evaluation of disclosure controls in conjunction with filing of each quarterly report and annual report. Section 302 also requires the certifying officers to disclose any significant changes in the company's internal control or factors which affect internal control indirectly after the evaluation of disclosure controls is made. Section 302 gains importance since it puts the onus of the senior management of a company (certifying officers) to evaluate and report on the disclosure controls and procedures in place.

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