Application Protection – Part IV

The FCPA impacts IT control requirements of U.S. publicly held enterprises. Section 78m (b), in particular, documents the legislative rules and compliance requirements of internal control evaluation reporting with regard to management’s assessment of internal controls. Section 78m (b) (2) through (5) applies to Securities Exchange Act of 1934 filers. Therefore, the FCPA can affect an organization’s internal control environment by indirectly imposing management’s assurance of an adequate IT control environment with adequate information protection. Based on the Public Company Accounting Oversight Board’s interpretation, the SOX IT control parameter, in effect, is the same as that of the FCPA. Therefore, U.S. Securities Exchange Act of 1934 filers may not be aware of FCPA legal requirements — yet, they should have been performing the necessary FCPA control self-assessments and remedial actions since 1977. Similarly, European Union, OAS, and OECD member countries should be engaging in control self-assessments and remediation of internal accounting controls as they relate to safeguarding information assets to ensure compliance with legal mandates.

“View Part I of the Application Protection series here”