Implementing SOX 404 Compliance Initiatives with Auditing Standard 5

The Sarbanes-Oxley Act of 2002 , also known as the Public Company Accounting Reform and Investor Protection Act of 2002 and commonly called Sarbanes-Oxley, Sarbox or SOX, is a United States federal law enacted on July 30, 2002 in response to a number of major corporate and accounting scandals. The cost of complying with SOX 404 impacts smaller companies disproportionately, as there is a significant fixed cost involved in completing the assessment. As such the SEC passed Auditing Standard 5 to some what level the playing field for smaller public companies who must meet SOX compliance standards.