Disclosure Controls and Procedures & Internal Control Over Financial Reporting

Securities Lawyer 101 l Controls and Procedures

Securities Lawyer 101 Blog

Under the Sarbanes-Oxley Act, a company’s Chief Executive Officer and Chief Financial Officer must provide certifications in Form 10-K and Form 10-Q.  The certifications must state that they have reviewed the report, believe that it does not contain any material misstatements or omissions and that the included financial statements and other financial information fairly represent the issuer’s financial condition.

These representations must include a certification that the issuer’s “disclosure controls and procedures” are adequate to ensure the timeliness, accuracy and completeness of the periodic report filed with the SEC.

These disclosure controls and procedures are mandated by the Exchange Act at the end of each fiscal quarter the controls and procedures must be re-examined by the issuer’s Chief Executive Officer and Chief Financial Officer and the results must reported in the relevant report.

Among the procedures commonly implemented by reporting companies is the designation of a “Disclosure Committee” of key insiders to assist in the evaluation process and review all periodic reports and other SEC filings. In most instances, the Chief Executive Officer and Chief Financial Officer perform this review in most instances.

Beginning with the company’s second annual report, certifications must be provided that state that the issuer has internal control over financial reporting to provide reasonable assurance on the integrity of the financial statements and internal financial processes.  Also for all companies, except smaller reporting issuers, their outside accountants must provide an attestation report on internal controls.

The assessment must be based upon a “recognized control framework”.

For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit www.securitieslawyer101.com.   This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates | Securities Lawyers
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 North
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855