Internal Control and Financial Reporting Assessment in Romania - Methods and Techniques Applicable to Financial Audit Practice

The financial scandals and the series of businesses insolvencies - the cause of the rapid decline of investors' confidence in capital markets - they carry imperatively the application of corporative governance rules within supervision and the financial reporting according to the provisions of Sarbanes-Oxley Act, the international and national standards for the supervision of public accounting regarding the internal control auditing of financial reporting corroborated with financial statements of public companies. The attempt to intensify companies corporate respondents' sense of responsibility and to re-edify investors' confidence in companies' financial statements needs both a clear delimitation of executive governance, jurists, accountants, public companies auditors' responsibilities regarding the internal control over financial statements, and the public reporting of any weaknesses of the internal control over financial reporting existing until the date of the assessment made by the company's management and by the auditor. The motivation of the implementation of an internal control over the financial statements may be materialized in investors' significant benefits due to the intensification of company's assignees efforts to prevent frauds, on the one hand, and to monitor the raise of periodic financial reports' credibility, on the other hand. The Sarbanes-Oxley Act (Section 404) formulates requirements towards corporate respondents regarding monitoring and consolidating their own internal control over financial reporting. In order to benefit to the full by the effects of these requirements, the users of financial statements must be informed about these and the implications of the implementation of Section 404 from Sarbanes-Oxley Act, so that they could understand and assess the responsibilities of public companies, of their auditors regarding the identification of the motifs and implications of weak points within the internal control over financial reporting on one company's financial position and performances.