What Sarbanes-Oxley Won't Do
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This is interesting. Another case of corporate fraud under the title of "What Sarbanes-Oxley Won't Do". Apparently someone got loans, blah, blah, fraud, blah, blah, etc. You get the idea and I'm tired of having to hear and write about it.But since S-O affects most IT groups and many of us are dealing with it, it's worth talking about and writing about. S-O has required more documentation, processes, and accountability for how corporations deal with their financial data. It is intended to prevent another Enron or MCI like occurence by making high level executives accountable for the company's actions.
But it doesn't prevent fraud. It doesn't prevent dishonesty, and it certainly doesn't guarentee that your investment is safe in some company. It should make it easier to send people to jail, but even that hasn't been shown to be the case yet.
It does, however, make a lot of work for many companies. I was talking with a professional services company recently and they said that many of their clients, public and private, are trying to adhere to S-O because public companies have to, but private ones are either looking for an IPO or to be bought by a larger company, and S-O compliance is often part of the due diligence they'd need.
If you're an ISO company, you probably can use one set of docs for both certifications, although you'll need to dive deeper in certain areas for each one. That's the good thing since we know how much you IT folks love documenting your processes, procedures, and environments.
I'm just happy to say that SQLServerCentral.com is not complying and I, for one, am thrilled 🙂
Steve Jones
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Good editorial Steve. I think we're stuck with SOx compliance - for better and worse - for years to come. Thanks Enron and MCI!
Seriously, I think the law will be circumvented successfully for decades to come. The folks breaking SOx regulations are also breaking others, along with ethical violations. What makes anyone think these folks are going to violate seventeen sections of US and SEC regs and then stop and say "Hey, you know what? We're about to break SOx... hold everything!"?
I think the law addresses the wrong end of the issue. Why not certify investors instead? Make a DVD and VHS and Mpeg available where someone looks directly into the camera and states: "You could lose every single penny you put into the stock market. Do you understand?"
If consent is recorded, allow these folks to invest.Just my thoughts...
:{> Andy
Andy Leonard, Chief Data Engineer, Enterprise Data & Analytics
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All valid points, for sure, and impossible to really disagree with.
It's amusing, though, isn't it, that the people trying to comply with SOx are largely the same group who were trying to do the right thing to start with. Like most laws, the only folks it affects are the ones who were the least likely to break any of those unwritten rules. The greedy will continue to take risks to fulfil their material missions, and the decent folks will pay the price for those crimes.
Here's to the hope that somehow these new rules and regulations actually make some of the decent companies more profitable by shifting investment to where it always should have been, in the hands of the people who actually care about returning value.
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The other frustrating point is that the gatekeepers (Arthur Anderson & others) who were sleeping on the job allowing much of this to happen were awarded twice as much business as a result of their first failure. Name one other industry where this happens. SOX has demonstrated that it can pay to be incompetent at your job.
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I think you are right on .. We don't comply with SOX and I dont plan to. We are actually thinking of moving off shore. We will of course report all of the income as required by US Law but ... we wont have to comply with SOX .... I suspect that others will do the same, especially since it's just a hop, skip and a jump to Nassau or Freeport from Florida which is where we are located. We are honest as the day is long and frankly I highly resent being forced to prove it to the US Govt which aint so honest itself if you watch much of the news.
I do think though, that it might be fair (and honest) to say that we brought a lot of this upon ourselves, and will probably continue to do so, by holding up these extreemly rich fat cat CFOs and high rollers as some kind of corportate gods and wonderful citizens because they are rich. We deal in bankruptcies and we see over and over these managers going from company to company, getting huge golden parachutes , ruining a company and bailing out to riches and glory leaving all the other employees and stock holders to their own terrible fate. Then, because they made a ton of money from it, they get hired at the next company that wants to ride their coattails to fame and glory. Of course, they think that **they** wont end up in the ditch like the firm that the guy just came from, because obviously it must have been the fault of all the inept employees that he was not allowed to replace ... etc, etc. Then guess what ...
Having spent about 14 years in banking and 4 of that as a bank examiner, I learned along time ago to not put a penny into the stock market because as a two-bit investor I didn't have any control over how other people used my .. I repeat .. *my* money. I've sunk in into real estate and done far better than the stock market. And you know what .. it's pretty darn hard for someone to steal a house ...
Enough rant .... back to work.
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Name one other industry where this happens...
Apparently congress is another place.
There you can take a $2.4 million bribe but only have to give back $1.8 million keeping $600k for your trouble.
Put that in your Christmas SOx!
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So SOX is just like a bribe for the Accounting and Auditing firms out there?
Plus, I am sure the folks who invested and worked at Enron wish they only came in and took $600K.
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Cringely had a good piece on this about the new robberbarons:
http://www.pbs.org/cringely/pulpit/pulpit20050804.html
In a nutshell: This and related legislation will be used to drive the smaller more competitive institutions out of business or to be bought up cheap by the larger conglomerates. Any way around it, the consumer loses.
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