Emerging Growth Company - SOX 404A

Becoming an emerging growth company in corporate America? We can equip you with a validated step-by-step approach.

What's required in 1st year as a public company SOX 404A part 1

In the first year as a public company, what's required or recommended for an Emerging Growth Company (EGC) under SOX 404A? Part 1 covers general activities. Part 2 covers specific ...business processes.
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An emerging growth company is a company that just went public and has a public float of less than $700 million. As a company that just went public, you must be compliant with SOX 404A – it is not a negotiation or a recommendation, it’s a requirement.

SOX 404A requires you to report on your own assessment of your company’s internal controls. SOX 404A compliance proves that your internal controls are functional and in order.

Becoming SOX 404A compliant is a delicate process and you CANNOT afford to make mistakes!

But don’t worry! We’re here to help you go through the process hitch-free.

Our experts at A2Q2 will arm you with adequate business strategy plans, performance improvement guidelines, and all necessary guidance and mentorship as you phase through this process.

As an emerging growth company, whether you’re doing it internally, outsourcing, or co-sourcing, we’ve put together the minimum requirements and recommendations for you to meet SOX 404A compliance. These are the typical activities that we will use to prepare you for SOX readiness.

THE PLANNING STAGE

The first procedure requires planning, putting together the timelines, the actual plan, and the risk assessment. We conduct a business risk assessment and IT risk assessment to narrow the scope as much as possible.

CREATING A COSO MAP

The next one is a COSO 2013 mapping. COSO is the internal controls framework that 99% of companies use. Your external auditors will require that you have a COSO Framework because it is the entity level that sets the tone while making sure you have the key controls in various areas.

SEGREGATION OF DUTIES

Segregation of duties is vital to your internal control framework, financial reporting, and SOX compliance. It is a component of an effective control environment that prevents a single team member from completing two or more tasks in your process.

It allows you to assign business responsibilities in your company to more than one team member. With this, you get to mitigate the risk of waste and error, while boosting the effectiveness of your ICFR.

FINANCIAL CLOSE AND REPORTING

Your financial close cycle provides an accurate overview of all your financial and transactional data within a given period. Representing this data accurately and consistently is vital for your company to make productive financial and strategic decisions.

The more you understand the data of your financial and accounting activities, the better you will be able to project your company’s future performance. So, without an accurate and consistent representation of this data, you will suffer both internal and external consequences.

IT GENERAL CONTROLS (ITGCs)

ITGCs determine how technology is designed, administered, and used in your organization. They configure everything from system updates, upgrades, configuration management, password creation, protection policy, application development, and even user-account creation.

This sector covers access to programs and data, change management, system development, and computer operations. That is why we harness these technologies to bring you progressive solutions in all of these components:

  • Access to systems and programs
  • Change management
  • System development controls
  • Computer operations

All of the processes may be challenging for you, BUT they are a breeze for us at A2Q2. It’s what we do, and we assure you high-quality service delivery.

Talk to us today and let’s make an outstanding impact on your business!

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