SOX Compliance Checklist and Requirements

The Sarbanes-Oxley Act of 2002, also known as SOX compliance, is a set of legal requirements for companies. Ultimately, the goal of this compliance is to prevent fraud or misinterpretations in financial reporting. This act emerged as a response to financial scandals and the losses they have caused.

In this article, we’ll figure out:

  • What is SOX compliance?
  • How can you meet its goals?
  • What does the SOX security compliance checklist include?

Even if you are not required to meet the SOX compliance requirements right now, our checklist will help you with self-assessment and preparation for the future.

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SOX Compliance Overview

SOX compliance is required to protect investors by setting up standards for companies. These standards aim to prevent manipulation with financial reports. Companies should follow these standards to ensure the transparency and security of corporate business activities.

First and foremost, SOX regulates U.S. public companies. In some cases, private companies and non-profit organizations need to comply, as well. Also, this compliance impacts non-U.S. companies operating in the U.S. To stay compliant, all companies must pass a SOX compliance audit―a procedure of assessing a company and its internal controls.

A significant part of SOX compliance is dedicated to business records protection. Taking into account modern business practices, often it means the protection of your digital data stored in corporate clouds like G Suite and Office 365.

SOX Compliance

One of the core goals of SOX regulatory compliance is to make financial reporting transparent. The non-compliance may result in monetary penalties up to $5 million or even imprisonment. An organization’s CEO and CFO (or equivalents) have responsibility for financial reports and their accuracy.

The act consists of sections covering corporate responsibility for financial reports, management assessment of internal controls, and other issues. They are highlighted in the full text of the Sarbanes-Oxley Act.

Let’s take a look at the Sarbanes-Oxley compliance checklist and what actions you can take to improve the transparency and security of your data.

SOX Compliance Checklist

The following SOX compliance IT checklist will help you to secure your system and align it better with the record protection requirements.

  1. Detect security breaches. Ensure you can detect any security breaches (for example, phishing or ransomware attacks). Specialized software can help you to do it.
  2. Prevent data loss. It’s a good idea to implement a data loss prevention strategy. Using backup software would be a great help here.
  3. Ensure that your data is protected in real-time. Corporate information should stay safe round-the-clock. That’s why using automated security software may be a good idea.
  4. Prevent tampering with your data. Control user login, login attempts, and other forms of domain activity. Ensure that you know who has access to corporate’s critical data.
  5. Provide verifiable reporting. Similar to financial reporting, data security should be accountable as well. You need to have clear reports regarding your security statuses. Report any issues immediately.
  6. Give SOX auditors access to the data they need. Be ready to provide information about the security measures you take to protect your data. If you use role-based data access, you can configure it.
  7. Maintain internal controls in a secure way. To follow SOX compliance, internal controls should be implemented and managed. Internal controls assessment should be performed regularly to confirm their effectiveness.

How Spin Helps You to Meet SOX Compliance Requirements

SpinOne for G Suite helps you to protect and monitor your data in order to meet IT security compliance requirements. That’s what our security software can do for you.

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Learn More About Data Security Compliance

SOX is not the only compliance standard you may need to follow in your daily business activities. We recommend reading more about HIPAA, NIST, or GDPR to ensure your data security meets the highest standards.

If you use cloud services like G Suite and Office 365, check out the cloud data security and compliance best practices.

Here, you can read how our security products help you to protect your data and stay compliant.

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