IFC and SOX Compliances

Internal Controls on Financial Reporting (ICFR) and the Sarbanes-Oxley Act (SOX) are critical frameworks that protect financial integrity, governance, and stakeholder trust. The applicability of internal financial controls is now a material requirement for organizations. While IFC applicability in India ensures compliance with local regulations, global obligations under the Sarbanes-Oxley Act require businesses to adopt robust compliance programs to reduce risks and ensure reliable reporting. At CAC, we help organizations implement and strengthen IFC and SOX compliance in a structured, practical, and scalable manner. From company-wide assessments of internal financial control applicability to preparing for SOX regulatory compliance and Sarbanes Oxley audits, our experts provide end-to-end support.

Our Comprehensive IFC & SOX Services

Risk Assessment & Control Design

Risk Assessment is done to identify the operational and financial risks that are critical to the business and once identified we designed appropriate internal controls to mitigate those risks. This allows us to provide both IFC applicability and a framework for Sarbanes-Oxley compliance standards.

Control Documentation

We prepare clear and concise documentation that evidences compliance, identification of the key internal checks and controls to use (to reduce reliance on others), reference guide in the event of an audit (i.e. audit trail), and demonstrates adherence to the Sarbanes-Oxley Act.

Control Testing for an Operating Effectiveness

We execute testing procedures, investigations, and observations that reflect whether controls were operating as designed in real life situations; thus, ensuring reliability in respect of IFC applicability in India or globally for SOX compliance.

Deficiency Assessment

Where we assess your control environment to identify deficiencies, and control weaknesses to understand gaps that could potentially impact compliance or accuracy and reliability of financial reporting.

Recommendations for Remediation

We provide you with feasible, realistic-somewhat to cure deficiencies, strengthen accountability and provide you with comfort leading to a successful Sarbanes Oxley audit.

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Why choose CAC for IFC & SOX?

Expertise - Our teams are expert led with complex and in-depth knowledge of Sarbanes Oxley Act and IFC applicability for India.
Tailored Solutions - Designed around your risk, industry and business objective.
Technology - Enabled Insights and enablement of testing, monitoring and reporting model.
Advisory - Before and above compliance, advising on resilience and trust.

At CAC IFC and SOX compliance services support businesses to remain compliant, minimize risk and work with confidence, regardless of whether if you’re managing a new framework to be proactive in testing controls or looking to strengthen corporate governance.

FAQ

What is IFC compliance and why do we need it?

IFC, or Internal Financial Controls, are the processes and policies we establish to ensure the reliability and accuracy of our financial reporting. We need it to comply with local Indian regulations, protect our financial integrity, and maintain stakeholder trust.

How does the Sarbanes-Oxley Act (SOX) compliance affect us?

SOX compliance is a critical framework for our global obligations, ensuring reliable financial reporting and strong governance. It requires us to adopt robust compliance programs, which we implement to reduce risks and prepare for regulatory audits.

What is the key difference between IFC and SOX compliance?

IFC focuses primarily on adhering to local Indian requirements for Internal Financial Controls over Reporting (ICFR). SOX is a broader, global obligation established by the U.S. that mandates robust internal controls for companies operating in the U.S.

What does a Risk Assessment involve in the IFC and SOX process?

Our Risk Assessment involves identifying the key operational and financial risks critical to the business. Once identified, we design appropriate internal controls to mitigate these specific risks, setting the foundation for both IFC and SOX standards.

How do we test the effectiveness of our internal controls?

We execute thorough testing procedures, observations, and investigations to confirm if our controls are operating exactly as they were designed in real-life situations. This testing ensures the reliability of our financial reporting for both IFC and global SOX compliance.

Does IFC and SOX compliance only cover financial processes?

While the core is financial reporting, the compliance frameworks involve assessing and designing controls across the entire organization. We look at operational and financial risks to ensure a company-wide assessment of internal control applicability.

What are the benefits of having a strong IFC and SOX compliance program?

A strong program helps us remain compliant, minimize financial risk, and work with greater confidence. Beyond just meeting regulations, it helps strengthen corporate governance, provides technology-enabled insights, and builds stakeholder trust.

Is SOX compliance required for Indian companies?

SOX compliance is specifically required if we are a U.S.-listed company or have significant operations that fall under the U.S. Securities and Exchange Commission (SEC) jurisdiction. Otherwise, we adhere to the local IFC applicability requirements.

What is an ICFR audit?

An ICFR (Internal Controls on Financial Reporting) audit is the formal assessment of the controls we use to prevent material misstatements in our financial statements. We must demonstrate that these controls are designed effectively and operating properly throughout the reporting period.

What are the 4 pillars of SOX excellence?

The four pillars of SOX excellence are: Risk-Based Scoping, Process and Control Documentation, Consistent Control Testing, and a Strong Control Environment (Tone at the Top). We must ensure all four are robust and continuously monitored.

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