Sarbanes-Oxley (named as such after its legislative sponsors) was enacted in 2002 in response to corporate scandals and collapses. Its scope is indicated by its formal title, The Public Company Accounting Reform and Investor Protection Act of 2002.
Section 404 of Sarbanes-Oxley requires the management of companies to annually assess and assert as to the effectiveness of the organisation’s internal controls and its procedures for financial reporting. It also requires the external auditor to report on the effectiveness of these controls, and potentially on management’s evaluation process.
Where KPMG is a company’s financial statement auditor, it is required to attest to the effectiveness of internal controls and procedures relevant to financial reporting.
KPMG can also advise companies on their broader compliance obligations under Sarbanes-Oxley, and where KPMG is not the financial statement auditor, can assist them in the development and documentation of their internal control environments.
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