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Compliance Framework

SOX

Sarbanes-Oxley Act

The Sarbanes-Oxley Act requires U.S. public companies to maintain accurate financial reporting, implement internal controls, and provide auditable evidence of compliance. ServiceNow GRC/IRM helps organizations automate SOX control testing, link controls to risks and issues, and build audit-ready reporting.

What is SOX?

The framework explained

The Sarbanes-Oxley Act (SOX) was enacted in 2002 in response to major corporate accounting scandals. It establishes requirements for financial reporting accuracy, internal control effectiveness, and executive accountability for U.S. public companies. Section 302 requires senior executives to personally certify the accuracy of financial reports. Section 404 — the most operationally demanding provision — requires management and external auditors to assess and report on the effectiveness of internal controls over financial reporting (ICFR). SOX compliance requires organizations to maintain documented, tested, and auditable controls across financial processes — and to demonstrate that control deficiencies are identified, tracked, and remediated in a timely manner.
ServiceNow Approach

How ServiceNow addresses SOX

ServiceNow GRC/IRM provides a connected platform for SOX compliance that replaces disconnected spreadsheets and manual evidence collection. Control testing can be automated with structured test plans, pass/fail/partial results, and automated issue creation when controls fail. Risks, controls, issues, and remediation tasks are linked in a single data model — giving auditors a clear chain of evidence from risk identification through to remediation. Key indicators and thresholds trigger escalation before control failures become material weaknesses. Executive dashboards provide management with real-time visibility into control effectiveness and open remediation items. ServiceNow also integrates with external audit tools and supports the production of Section 404 evidence packages — reducing the time and cost of annual audit preparation.
XAAS Implementation

How we implement SOX

XAAS Solutions implements ServiceNow GRC/IRM for SOX compliance by starting with a structured assessment of your current control environment, documentation practices, and audit history. We define your SOX control taxonomy aligned to COSO or PCAOB frameworks, configure weighted risk scoring and control effectiveness logic, and implement automated testing workflows that route control evidence to the right owners. We build executive dashboards covering control testing status, open deficiencies, remediation progress, and audit readiness — and configure KRIs that alert management when control health deteriorates before auditors arrive. The result is a SOX compliance program that operates continuously rather than scrambling annually.
Frequently Asked Questions

About SOX on ServiceNow

What is SOX compliance?

SOX compliance refers to meeting the requirements of the Sarbanes-Oxley Act, which mandates that U.S. public companies maintain effective internal controls over financial reporting, document and test those controls, and provide auditors with evidence of their effectiveness.

What is Section 404 of SOX?

Section 404 requires management to assess and report on the effectiveness of internal controls over financial reporting (ICFR), and requires external auditors to attest to that assessment. It is the most operationally demanding part of SOX compliance.

How does ServiceNow help with SOX compliance?

ServiceNow GRC/IRM automates SOX control testing, links controls to risks and issues, tracks remediation of deficiencies, and builds audit-ready dashboards — replacing manual spreadsheet-based compliance programs with a continuous, auditable operating model.

What are common SOX control deficiencies?

Common SOX control deficiencies include inadequate segregation of duties, insufficient access controls over financial systems, weak change management processes, incomplete audit trails, and delayed remediation of identified issues.

Can ServiceNow automate SOX control testing?

Yes. ServiceNow GRC/IRM can automate control testing workflows, route test evidence to control owners, calculate control effectiveness based on test results, and automatically create remediation tasks when controls fail or are rated partially effective.

Who needs to comply with SOX?

SOX applies to all U.S. publicly traded companies and their subsidiaries, as well as foreign private issuers listed on U.S. exchanges. Some provisions also apply to accounting firms that audit public companies.

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