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Questions For Ais

The Sarbanes-Oxley Act (SOX) impacts Accounting Information Systems (AIS) by enforcing strict internal controls over financial reporting, applicable to all companies listed on U.S. stock exchanges regardless of software origin. While SOX primarily targets U.S. public companies, it can indirectly influence non-U.S. companies with U.S. operations or listings, prompting some to adopt SOX principles for enhanced governance. Overall, SOX has set a global precedent for corporate accountability and transparency, affecting practices even in companies outside its jurisdiction.

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38 views2 pages

Questions For Ais

The Sarbanes-Oxley Act (SOX) impacts Accounting Information Systems (AIS) by enforcing strict internal controls over financial reporting, applicable to all companies listed on U.S. stock exchanges regardless of software origin. While SOX primarily targets U.S. public companies, it can indirectly influence non-U.S. companies with U.S. operations or listings, prompting some to adopt SOX principles for enhanced governance. Overall, SOX has set a global precedent for corporate accountability and transparency, affecting practices even in companies outside its jurisdiction.

Uploaded by

Fel-An Gaitera
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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How does SOX affect AIS? Does SOX's jurisdiction covers all AIS software?

Or only software from


the US?

The Sarbanes-Oxley Act (SOX) has a significant impact on Accounting Information Systems (AIS)
utilized by companies, regardless of their geographic location. SOX mandates strict internal
controls over financial reporting processes, which directly affects how AIS is implemented and
managed within organizations. Companies subject to SOX compliance must ensure that their AIS
effectively captures, processes, and reports financial data accurately and with adequate controls
to prevent fraud or errors. The Act requires the integration of internal controls within AIS to
ensure the reliability of financial information disclosed to stakeholders.

SOX's jurisdiction extends to all companies listed on U.S. stock exchanges, irrespective of where
their AIS software originates. This means that even if a company uses AIS software developed
outside the U.S., it is still subject to SOX regulations if it meets the criteria for compliance. The
Act's focus is on the financial reporting integrity of companies that fall under its jurisdiction,
rather than the geographical location of the software providers. Therefore, companies using AIS
software, regardless of its origin, need to ensure that their systems align with SOX requirements
to maintain compliance and uphold the trust of investors and regulatory bodies.

2. Ana nalang, How does SOX law affect companies outside US? Since the SOX law came from
the US, is there any direct impact or influence of SOX to companies that are outside the
jurisdiction of SOX law?

The Sarbanes-Oxley Act (SOX) primarily applies to U.S. public companies and requires them to
comply with certain financial regulations to protect investors and maintain the integrity of
financial reporting. However, even though the law is U.S.-centric, it can still have indirect impacts
on companies outside the U.S. This is because many non-U.S. companies have subsidiaries,
operations, or listings in the U.S., which could subject them to SOX compliance requirements.
Additionally, some non-U.S. firms choose to voluntarily adhere to SOX principles as a means of
enhancing governance and transparency, which can improve investor confidence and access to
U.S. markets.

For companies entirely outside the jurisdiction of SOX, the direct impact is minimal as they are
not legally bound to comply with its provisions. However, the key influence of SOX on these
international companies lies in the broader trends it has set in corporate governance and
financial best practices. The stringent standards introduced by SOX have influenced global
conversations and regulatory developments regarding corporate accountability, transparency,
and internal controls. As a result, many non-U.S. firms have adopted similar practices to build
trust with stakeholders, promote ethical conduct, and safeguard their reputations in the global
marketplace.

3. naa koy nabasa nga dili sa ais software affected sa SOX but ang company

In essence, SOX primarily affects the company's culture and processes. However, to comply with
SOX, companies need to make significant changes to their AIS to ensure it meets the stricter
requirements for data security, auditability, and access control.

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