Security and Exchange Commission rules require that "the assessment of a company's internal control over financial reporting must be based on procedures sufficient both to evaluate its design and to test its operating effectiveness." In order to obtain reasonable assurance regarding the operating effectiveness of controls, key controls must be tested to validate their effectiveness.
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If not already done, we'll develop test plans to validate the operating effectiveness of key controls for each process. The test procedures are designed to evaluate whether a control is operating as intended, such that it will provide reasonable assurance that control objectives will be achieved for the relevant financial statement assertions related to significant accounts and disclosures. The main objective is to demonstrate that controls covering all five components of internal control are operating effectively relative to all significant accounts and processes.
We complete the test procedures in accordance with the test plan to identify, analyze, and document sufficient information to demonstrate the achievement of the test objectives. The goal is to provide sufficient evidence to form an opinion regarding whether key controls are operating effectively.
Security and Exchange Commission rules state that "in conducting an evaluation and developing its assessment of the effectiveness of internal control over financial reporting, a company must maintain evidential matter, including documentation, to provide reasonable support for management's assessment of the effectiveness of the company's internal control over financial reporting." Vonya Global has work paper documentation standards, consistent with the expectations of the SEC and PCAOB, to ensure consistent and high quality work papers.
Control deficiencies are conditions identified through test procedures that indicate that a key control is not functioning effectively. These conditions require remediation. Each deficiency will be referenced to a specific work paper that provides evidence that a deficiency exists.
The Sarbanes-Oxley Act of 2002, Section 404(a)(2) requires Management’s assessment of internal control to be "as of" the organization’s fiscal year-end. Vonya Global will complete procedures to ensure controls are operating effectively as of each fiscal year-end.
Please contact our Sarbanes-Oxley compliance team to learn about how we can help you through the SOX testing process.