| The Sarbanes-Oxley Act was passed on July 2002 | | | | asset is with regard to the company's financial |
| and many public companies in the US have been | | | | performance. Since Sarbanes-Oxley compliance |
| implementing compliance procedures since then. | | | | requires a clear insight into the financial workings of a |
| Unlike other business standards, the Sarbanes-Oxley | | | | public company this becomes a complicated issue. |
| Act requires a more detailed disclosure in its filings with | | | | That's because the value of an asset here is not |
| the US Securities and Exchange Commission (SEC) | | | | simply monetary, yet using good Sarbanes Oxley |
| on everything that might affect a company's business | | | | software can help manage and audit this necessary |
| and financial performance. | | | | procedure. |
| The Sarbanes-Oxley Act requires that public | | | | Since IP asset value is lost or gained based on the |
| companies use well established "disclosure controls | | | | intellectual property rights obtained for any given |
| and procedures" for all intellectual property (IP) assets | | | | product the value of an IP asset it is easier to explain |
| so this vital information is first presented to the | | | | to the SEC how in compliance with Sarbanes Oxley |
| management of that company well before it's | | | | the company has more or less valued that asset. |
| revealed to the SEC. The Sarbanes-Oxley Act also | | | | The management's next job, to ease the ongoing |
| requires these procedures to be evaluated quarterly to | | | | implementation and compliance with the |
| ensure that outdated and ineffective procedures are | | | | Sarbanes-Oxley Act, is to make sure that there are |
| removed and new ones implemented for better | | | | procedures in place that automatically protect their IP |
| efficiency. | | | | assets. |
| At the moment the Sarbanes Oxley Act does not | | | | To ensure ongoing Sarbanes Oxley compliance it is |
| actually define the steps a public company should | | | | essential to conduct employee training starting from |
| specifically take in order to ensure complete | | | | the top and trickling downwards with reinforcement at |
| compliance with the Act. As a result most public | | | | every step of the way. It is important that actions |
| companies are usually left in a bit of a quandary. | | | | taken on these procedures and the reports generated |
| A big hurdle for companies is to fully inventory their | | | | are move upwards so that they can reach the |
| Intellectual Property Assets (IP assets). Intellectual | | | | appropriate division heads and ultimately the CEOs and |
| Property rights in themselves are a quagmire of | | | | board of directors. |
| regulations and laws and since the Sarbanes-Oxley | | | | Management will have to think of new ways and |
| Act requires all IP assets to be help accountable to the | | | | methods to make this happen because such broad |
| SEC this usually causes a big problem. Going further, it | | | | and overall changes are not easy to implement when |
| is not often an easy matter to determine exactly how | | | | the established culture is so contrary to what is now |
| the I.P. assets of a company are affecting its financial | | | | being expected. |
| performance. This involves an internal audit and | | | | Since the scandals of previous public companies have |
| information gathering process of a company and can | | | | resulted in the enactment of the Sarbanes-Oxley Act, |
| prove to be time consuming and financially unviable until | | | | the Act demands a clearer look into a public |
| the procedure becomes well established and is a | | | | company's finances. This involves more honesty at |
| matter of routine. | | | | each step, involving everything, that would affect a |
| The next step is to determine the value of each IP | | | | company's financial performance, for better or for |
| asset and finding out exactly what the nature of this | | | | worse. |