Category : IPA
SOX Act Slowing Up Public Companies, Trying to Sell Structured Settlement?
Yes, of course it does. Even the best, well laid plans and software throughout the year to accommodate SOX, will still slow down a public company’s finance departments end of year reporting for transparency; along with the annual, glossy, end of the year SEC reporting as well.
SOX or the Sarbanes-Oxley Act of 2002, became into action in 2006 for the very first time mandated public companies in the U.S. to be audited by an independent third party CPA. This is huge considering the NYSE has been in business since 1792.
The first time ever in 214 years, Congress has made public companies subject to even more regulation. It happens in your lifetime.
Is this a good or bad thing? It depends on how you look at it. Is the public company able to handle SOX and SEC reporting AND still cater to its clientele?
That’s a big question. Some clients want companies they do business with to have more regulation and transparency.
Along with whether or not any officer of the public company has mistakenly made accounting errors, which could lead to $1 Million in fines and up to 10 years in jail, or purposely made accounting errors would lead to $10 Million in fines and 20 years in jail.
Violating the SOX Act is serious business. You better believe an officer of Public Company “X” is probably not thinking too much of acquiring new clientele or about existing clientele with steep fines and jail time looming over
his head, if there are any mistakes in accounting.
On the bright side of business, there’s always private companies that have great venture capital funding, don’t need to go public, and they are waiting for your business. Maybe they have too much business.
The advantages to private companies are that their business plan and finances remain private, and there’s no end of the year, glossy, annual report due to the SEC, nor are they subject to SOX reporting.
Private companies are required to produce accurate and current finance records, but nothing like what a public company must report.
This way, a private company gets to spend more quality time; one on one with their clients; have more creative business plans, without having to answer to an entire group of shareholders that alter the business plan.
If you are trying to sell your structured settlement, consider the business climate, the economy, the company itself. Is the company public or private? Will they have the time to cater to you? Call an Independent Professional Advisor. Find out. Call for rates.
Trying to Sell Structured Settlement?