This additional compliance step – viewed only as an extra measure of protection – raises the spotlight on financial professionals and their role in supplying accurate financial reporting. It requires the employees responsible for a company’s financial information to certify the data they provide that is later included in public financial reports, even though such measures are not required under Sarbanes-Oxley provisions, according to a new survey by the Association for Financial Professionals.
>However, the majority does not feel entirely comfortable with this new level of responsibility. Nearly 80% of financial professionals asked to sign an affidavit expressed a “high” or “moderate” level of concern about their liability, with 23% seeking counsel from an attorney, either from the company’s lawyer (21%) or their own personal legal representative (2%).
Among the documents financial professionals – job titles that ranged from treasurers to cash managers – were asked to subcertify:
- specific disclosures in Management’s Discussion and Analysis or footnotes
- specific account balances
- compliance with company policies and procedures
- adequacy of internal controls in their department/area
- compliance with company code of conduct.
“I believe the prevalence of subcertification, while a direct result of Sarbanes-Oxley, reflects the increased level of importance that financial professionals hold within their companies,” said Jim Kaitz, AFP’s president and CEO, in a statement. “Greater accuracy in financial reporting and increased accountability will ensure that most companies are honest and report earnings accurately. This knowledge will ultimately lead to a more stable economic environment.”
The report of survey results and a white paper on subcertification are available on AFP’s Web site at www.AFPonline.org .