Big4Guy

Policies and procedures play an important role in sarbanes oxley compliance. Policies are high level management directives on a process. Procedures on the other hand talk more about the way to implement management's directives. For sarbanes oxley compliance, it is important that policies relating to financial reporting are established and communicated throughout the organization. Such policies should be
supported by procedures resulting in implementation of policies.

Such policies and procedures can be developed by management using formats such as flowcharts, narratives, control matrices etc. There needs to be a policy and procedure for each significant financial reporting related activity. Management should make efforts to keep the policies standardized. Documentation for policies should include the following:

- Purpose of the policy
- Business locations to which the policy applies
- Owner of the policy
- Areas / Issues covered by the policy
- Person responsible for implementation and execution of the policy
- Steps to be taken in case of policy failure
- Effective date of the policy

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