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Company Internal Control and its Legal Impacts:


Legal Impacts of Internal Control over Business Company
Company Internal Control and its Legal Impacts:

                We knows the importance of internal control for a business company. The Company can improve its production capacity, quality and performance to make more improvement in its internal control system. The Company Communication flow and its dealing with its clients, customers and vendors are more essential to give us a glance picture of its performance and show us the real time picture of its internal control over its departments and different operation units.

We knows that making a company and running its operations in the country and at international level is not an easy job. In past we saw many corruption in companies operations. The relationship of the corporations leadership and politicians is not a new topic to discuss here. Both are trying to save their interests. But sometimes or in some cases here about corruption.
   
Every country in the world wants a corruption free environment in every kind of business both in public and private sectors. Governments of different countries develop rules and regulations to eliminate and reduce the level of corruption or bribery issues form their countries.

I present  the working of the United States of America in this regards, United States wants to eliminate and reduce the effects of corruption, bribery and kickbacks from it legislative and corporations. The FCPA-Foreign Corruption Practices Act is an example of it. Through which they want to keep safe the congruous personal or legislative form corporations. Corporate can use their funds for them to make influence over them and use their influence over their legislative rights and responsibilities.  This act prohibits bribery of any foreign official or office, foreign political party or official thereof or candidate of political office in a foreign country. According to this law on political payments to foreign officials are prohibitions. Other payments to foreign business owners, corporate officers, executives, management and leadership not addressed by the FCPA act.

Under the FCPA act they requires all public companies to make their books of accounts, records of transactions and provide the authenticated and reasonable details which are perfect, clear, accurate and committed about their operations and all the relevant activities regards in their businesses. That’s the reason they need a proper system of internal accounting control which helpful to them to provide the reasonable information’s regarding their financial transactions, financial reports and their assets and all achievements.

In this respect the Sarbanes-Oxley Act of 2002 applies here on the issuers with the federal securities laws. As per these laws they requires audit committee with at least one financial expert, which is an independent member of the board of directors. The independent director is not attached to receives no compensations form the issuer.

The Section-404  of the act the management requires to establish and document internal control procedures and include it with the company financial reports.

The Section 302 of the act requires periodic statutory financial reports to include  the certifications that:

1.       The Signatory office must review the report.
2.       The report does not contain any mismanagement , misleading or omission in financial information.
3.       All the financial reports and statements must present with complete information about its operations and transactions.
4.       The Signing Officer must present the reports after complete review and with full information’s, the 90 days financial recorded data must be discussed and present with it.
5.       Information about all the deficiencies in the operations and financial reporting must be include within or with it.
6.       The factors and effects which have negative impacts over their operations must be the part of it and must present to the authorities.

Organizations must need to follow, full and provide the about requirement to work as corporations with in the united states. That’s are the some of the legal impact of the internal control over corporations.


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