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The Sarbanes-Oxley Act and How It Affects Businesses

Almost exactly 9 years ago in July 2002, the U.S. Congress passed the Sarbanes-Oxley Act, or SOX Act, which governs how companies perform internal audits and how they keep track of company data like payroll, sales and incentive compensation. Many business process software solutions offer automated financial reports that comply with the SOX Act, but not all of them cover internal processes like sales incentive compensation payments. Glocent, a incentive compensation management tool, provides SOX-compliant reports of all sales representative activity as well as incentives like bonuses, sales commissions and rewards for service. The SOX Act was known under many different names, including the Public Company Accounting Reform and Investor Protection Act and the Corporate Auditing Accountability and Responsibility Act, but its main goal was to hold companies accountable to the government for how they spend their money. The stated goal of the Senators who developed the SOX Act was to set higher standards for public accounting firms and companies when it came to transparency and internal auditing, and the act was drafted as a response to the business scandals of companies like Enron and WorldCom. In today's post-SOX Act business world, companies must be able to provide periodic financial reports to government officials if they request them. The company must also have internal accounting controls to ensure that reports are accurate and timely. In the past, this could mean a large accounting department or extra administrative staff to perform calculations and go over paperwork regarding sales and incentives. However, automated business process software solutions like Glocent take the pressure off employees by automatically generating reports that would pass any government auditor's inspection. Glocent uses real-time sales data gathered from other software such as SAP solutions, then uses this data to perform incentive compensation calculations as well as generate reports not only of commissions but also sales.

Transparency at the speed you do business!