Section 404 of the Sarbanes-Oxley (SOX) legislation enacted in the U.S. in 2002 requires companies that file annual reports with the Securities and Exchange Commission (SEC) to report on management's responsibilities to establish and maintain adequate internal control over the company's financial reporting process, as well as management's assessment of the effectiveness of those controls. SOX 404 and the auditing standards of the Public Company Accounting Oversight Board (PCAOB) also requires the company's external auditor to report on management's assessment, as well as on the effectiveness of the company's internal controls over financial reporting (ICOFR).
The Financial Instruments and Exchange Law (FIEL) passed by the Japanese Congress on 7 June 2006 requires all public companies listed on the Japan Stock Exchange to assess its ICOFR annually. Management of the listed issuer shall publish the result of its assessment in the listed issuer's annual report for the fiscal year beginning on or after 1 April 2008. The process for listed issuer to assess its ICOFR for compliance with FIEL's requirement is unofficially known as "J-SOX".
KPMG has a long history of providing internal audit services, including those with a focus on an organisation's financial statements and internal control environment. To date, KPMG has provided SOX/J-SOX assistance services to more than 475 companies globally and more than 40 companies in China.
We are able to tap into KPMG's global resources, including industry specific leading internal controls practices and KPMG's SOX Resource Centre (which contains regularly updated SOX related alerts, interpretive analysis and tools to ensure our SOX/J-SOX assistance services are consistently applied globally), to ensure that we not only provide you with practical advice on leading internal controls practices but also quality services that are inline with SOX/J-SOX requirements.
The significant experience gained by our RAS professionals through our previous SOX/J-SOX assistant services, including project management, control documentation review and ICOFR testing, and other internal controls assistance, has helped KPMG deliver quality and relevant services as an independent service provider.