SOX Compliance Checklist: A Guide for Managed Service Providers

What is the Sarbanes-Oxley Act (SOX)?

The Sarbanes-Oxley Act (SOX), enacted in response to corporate scandals like Enron, mandates that public companies in the U.S. ensure the accuracy of financial statements and strengthen their internal controls. This includes IT security, access controls, data backup, and change management, regardless of where the data is stored.

While recent SEC rulings have relaxed some requirements for small businesses, SOX compliance remains critical. The Sarbanes-Oxley Act requires financial institutions to ensure security by securely archiving and retaining electronic records, including emails and metadata, for at least seven years to meet audit requirements.

Who Does SOX Apply To?

SOX applies to all publicly traded companies in the U.S., their subsidiaries, securities analysts, and accounting firms that audit these companies. While private companies and nonprofits are generally exempt, exceptions exist. For example, private companies going public must comply when filing with the SEC, and whistleblowers at private firms servicing public companies are protected under SOX.

SOX prohibits any organization—public, private, or nonprofit—from destroying or falsifying financial records to obstruct federal investigations.

Though SOX is a U.S. regulation, its impact extends globally. Foreign public companies doing business in the U.S. must comply, and the act has inspired similar regulations worldwide, such as Canada’s C-SOX, Japan’s J-SOX, and EU regulations with parallels to both SOX and GDPR.

SOX Compliance Checklist for Managed Service Providers

Managed Service Providers (MSPs) play a pivotal role in helping small businesses manage their IT infrastructure. To help MSPs and their clients navigate SOX compliance, here is a SOX compliance checklist outlining key steps:

How Does Dropsuite Help With SOX?

Dropsuite offers a cloud-based email archiving and backup solution that helps organizations store, safeguard, manage, and discover data from Microsoft 365 and Google Workspace. Emails are securely backed up, archived using tamper-proof envelope journaling, and made searchable, discoverable, and accessible for SOX compliance testing.

Our solution simplifies compliance with SOX, as well as with the Health Insurance Portability and Accountability Act (HIPAA), the EU’s General Data Protection Regulation (GDPR), and other regulations.

For more information on how Dropsuite helps you and your clients stay compliant, contact us.

Additional Resources