SOX
U.S. federal regulation for financial reporting and controls
AS9120B
Aerospace QMS standard for distributors and stockists
Quick Verdict
SOX mandates financial controls and executive accountability for U.S. public firms to ensure reliable reporting, while AS9120B certifies aerospace distributors' QMS for traceability and counterfeit prevention. Public companies comply legally; distributors adopt for market access.
SOX
Sarbanes-Oxley Act of 2002
Key Features
- Mandates ICFR assessment and auditor attestation (Section 404)
- Requires CEO/CFO certifications with personal liability (302/906)
- Establishes PCAOB for audit firm oversight and standards
- Enforces auditor independence and non-audit service bans
- Imposes criminal penalties for false certifications and tampering
AS9120B
AS9120B Quality Management Systems for Distributors
Key Features
- Counterfeit and suspected unapproved parts prevention
- Traceability controls for split lots and chain-of-custody
- Risk-based external provider evaluation and flowdown
- Configuration management via sales order identifiers
- Enhanced preservation and product safety awareness
Detailed Analysis
A comprehensive look at the specific requirements, scope, and impact of each standard.
SOX Details
What It Is
Sarbanes-Oxley Act of 2002 (SOX) is a U.S. federal statute regulating corporate governance and financial disclosures for public companies. Its primary purpose is protecting investors by enhancing financial reporting accuracy and internal control reliability. SOX employs a risk-based approach via COSO framework, focusing on material financial assertions.
Key Components
- **Three pillarsPCAOB oversight (Title I), auditor independence (Title II), executive accountability (Titles III-IV).
- Core sections: Section 404 (ICFR assessment), 302/906 (certifications), 802 (document retention).
- Built on COSO principles; no fixed controls but key categories like ITGC, entity-level, process controls.
- Compliance model: annual management reports, auditor attestation for larger filers.
Why Organizations Use It
Mandated for U.S.-listed firms; reduces fraud risk, builds investor trust, lowers capital costs. Strategic benefits include operational efficiency, M&A readiness, governance maturity.
Implementation Overview
Top-down risk scoping, documentation, testing, remediation cycles. Applies to public issuers; exemptions for smaller/EGC filers. Requires external audits under PCAOB standards; ongoing monitoring essential. (178 words)
AS9120B Details
What It Is
AS9120B is the IAQG quality management system standard for aerospace distributors, built on ISO 9001:2015's 10-clause structure. It targets organizations procuring, storing, splitting, and reselling parts without alteration, using a risk-based approach to address distribution risks like traceability loss and counterfeits.
Key Components
- Over 100 aerospace-specific requirements in Clauses 4-10.
- Pillars: context analysis, leadership, risk planning, support, distribution operations (traceability, preservation, counterfeit prevention), performance evaluation, improvement.
- Built on PDCA; certification via accredited bodies with OASIS listing.
Why Organizations Use It
- Enables supply chain approval by OEMs/Tier 1s.
- Mitigates counterfeit risks, ensures chain-of-custody.
- Boosts market access (2,442 global certifications), efficiency, customer trust.
Implementation Overview
- Phased: gap analysis, process design, training, audits (6-12 months).
- For distributors globally; requires internal audits, management reviews.
Key Differences
| Aspect | SOX | AS9120B |
|---|---|---|
| Scope | Financial reporting, ICFR, governance, disclosures | Aerospace distribution QMS, traceability, counterfeit prevention |
| Industry | Public companies, all sectors, U.S.-focused | Aerospace distributors, aviation/space/defense, global |
| Nature | Mandatory federal statute, SEC/PCAOB enforced | Voluntary certification standard, IAQG-based |
| Testing | Annual ICFR assessment/attestation, PCAOB audits | Internal audits, certification body surveillance audits |
| Penalties | Criminal fines/imprisonment, SEC enforcement | Loss of certification, market exclusion |
Scope
Industry
Nature
Testing
Penalties
Frequently Asked Questions
Common questions about SOX and AS9120B
SOX FAQ
AS9120B FAQ
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