Financial Accounting Blog

Wednesday, March 10, 2004

CFO,com Repots that the Public Company Accounting Oversight Board (PCAOB) has approved new Sarbanes-Oxley Act rules governing how accounting firms will audit their clients' internal controls when reviewing their financial statements.

Under Section 404 of Sarbox, the management of a public company must assess the effectiveness of the company's internal controls over financial reporting. The section also directed the PCAOB to produce professional standards governing independent auditors' testing of and reporting on managements' 404 assessments.