Are your public company’s internal controls up to par? SEC stepping up enforcement with or without fraud
Abstract: Public companies must maintain and disclose internal controls over financial reporting (ICFR) under a variety of laws, but the SEC rarely used to pursue charges against companies for internal control deficiencies in the absence of fraud charges. Several years ago, however, the SEC announced its intent to pursue even minor violations, which can lead to more significant transgressions if ignored, as well as ICFR deficiencies that don’t involve fraud. This article discusses one recent enforcement action that reflects the SEC’s more aggressive posture.