The Sarbanes-Oxley Act has thrust many new responsibilities on the Board of Directors of small companies. PCMS recognizes this need for oversight and corporate professionalism. We achieve this by addressing these responsibilities proactively.

We do so by transforming the roles of Boards and Audit Committees; together we can explore such topics as redefinition of Board responsibilities, educational support, Board composition, and rules for independence. We can equip your company with the tools it needs to effectively address new issues that affect the company.

Board Roles: Auditing, Quality Control, And Independence Standards And Rules--
The Board shall:

1. Register public accounting firms
2. Establish, or adopt, by rule, "auditing, quality control, ethics, independence, and other standards relating to the preparation of audit reports for issuers"
3. Conduct inspections of accounting firms
4. Conduct investigations and disciplinary proceedings, and impose appropriate sanctions
5. Perform such other duties or functions as necessary or appropriate
6. Enforce compliance with the Act, the rules of the Board, professional standards, and the securities laws relating to the preparation and issuance of audit reports and the obligations and liabilities of accountants with respect thereto
7. Set the budget and manage the operations of the Board and the staff of the Board

Specific Board Compliance issues Regarding the Sarbanes-Oxley Act that we Address

Establishment: Board Membership
The Board will have five financially literate members, appointed for five-year terms. Two of the members must be or have been certified public accountants, and the remaining three must not be and cannot have been CPAs. The Chair may be held by one of the CPA members, provided that he or she has not been engaged as a practicing CPA for five years.

Insider Trades During Pension Fund Blackout Periods Prohibited
Prohibits the purchase or sale of stock by officers and directors and other insiders during blackout periods. Any profits resulting from sales in violation of this section "shall inure to and be recoverable by the issuer." If the issuer fails to bring suit or prosecute diligently, a suit to recover such profit may be instituted by "the owner of any security of the issuer."

We can help in establishing tips to avoid insider trading or selective disclosure liability: Section 16 reporting issues such as: Defining insider trading Contrasting insider trading with Regulation FD and Section 16 reporting of trading by insiders Registrants and Insider Trading SEC rules pertaining to insider trading

Prohibition on Personal Loans to Executives
Generally, it will be unlawful for an issuer to extend credit to any director or executive officer. Consumer credit companies may make home improvement and consumer credit loans and issue credit cards to its directors and executive officers if it is done in the ordinary course of business on the same terms and conditions made to the general public.

Disclosures Of Transactions Involving Management And Principal Stockholders
Directors, officers, and 10% owners must report designated transactions by the end of the second business day following the day on which the transaction was executed.

White Collar Crime Penalty Enhancements
The SEC has been given authority to seek court freeze of extraordinary payments to directors, officers, partners, controlling persons, agents of employees; The SEC may prohibit anyone convicted of securities fraud from being an officer or director of any publicly traded company.

SEC Authority to Prohibit Persons from Serving as Officers or Directors
The SEC may prohibit a person from serving as an officer or director of a public company if the person has committed securities fraud.

How we do this?

Our services are similar in scope to an audit, except that we use the term in reviewing compliance issues as a corporate assessment. In order to maximize the law verses the current business situation, our team of professionals will examine the issues of compliance against the company's current performance. From this initial overview, a wealth of information can be ascertained as it pertains to how PCMS services can best benefit the reality of each individual company.

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