SOX Compliance
Last updated: 29-12-2025
Light is a Smart Financial Platform (SFT) solution that complies with the Sarbanes-Oxley (SOX) Act by providing tools and features that address many of the key requirements of SOX, particularly around internal controls, financial reporting, and auditability.
Whether your organization is scaling or preparing for the requirements of becoming a public company, Light is designed to support strong protection, integrity, and reliability across core financial and reporting processes. Light helps establish robust measures that safeguard data accuracy, strengthen internal controls, and reduce operational and compliance risk. Light has aligned its control environment with recognized assurance standards, including SOC 2 Type II, and is on track with a SOC 1, supporting SOX and public-company readiness. Further details on controls and assurance alignment are available on request.
1. Internal Controls (Section 404)
1.1 Automated Financial Controls
Light provides built-in internal controls for financial transactions and processes. These controls help ensure that financial data is accurate, reliable, and secure throughout the organization’s end-to-end financial workflow and related configurations.
1.2 Segregation of Duties (SoD)
Light allows for defining and managing Segregation of Duties (SoD) rules within the system. By controlling and restricting access to sensitive financial transactions, the platform reduces the risk of fraud or error, and supports the design of effective ICFR where role separation is required, which is a key requirement of SOX compliance.
1.3 Audit Trail
Light ensures a comprehensive audit trail for financial transactions. Every change made to data is logged, and the system tracks who made the changes, when, and why, enabling easy tracking and verification for compliance purposes and facilitating audit evidence collection.
2. Financial Reporting (Section 302 and Section 409)
2.1 Real-Time Reporting
Light enables real-time financial reporting, ensuring that companies can generate up-to-date, accurate financial statements. This capability supports compliance with SOX’s requirements for timely and accurate financial disclosures as specified in Section 409, including timely visibility into material changes where relevant.
2.2 Automated Financial Statements
Light automates the creation of financial statements such as income statements, balance sheets, and cash flow reports. The system ensures that these statements align with SOX requirements and are consistent with the company’s internal control processes through standardized reporting logic and controlled data inputs.
2.3 Management Self-Assessment (Section 404)
The system helps facilitate management’s assessment of internal controls by providing clear visibility into controls, data integrity, and financial processes. This functionality supports management’s responsibility for the accuracy and completeness of financial statements and assists documentation of key controls for SOX-aligned programs.
3. Audit and Compliance Reporting (Section 404 and 802)
3.1 Continuous Monitoring and Logging
Light provides tools for continuous monitoring of financial transactions and controls. All transactions are logged, and data changes are captured, creating a comprehensive audit trail to track who approved what and when, which aids in the audit process required for SOX compliance and supports timely detection of control exceptions.
3.2 Audit Trail for Financial Data
Light ensures that every action related to financial transactions can be traced and reported. This includes tracking approvals, changes to financial data, and the users involved, which is crucial for meeting SOX’s auditability requirements and for auditor walkthroughs and testing.
3.3 Data Access Controls
Light allows for stringent role-based access controls that ensure only authorized personnel can access and modify sensitive financial data. This approach is crucial for maintaining data integrity and meeting SOX’s internal control requirements by limiting access to privileged functions and sensitive records.
4. Document Retention (Section 802)
4.1 Document Management
Light integrates with document management solutions to ensure that relevant financial documents are properly stored and retained for the required period, often seven years as specified by SOX. This integration ensures full compliance with SOX's document retention requirements.
4.2 Electronic Records Management
The system helps manage and archive financial data and documents in a secure, compliant manner. This approach enables easy retrieval during audits or regulatory inquiries, providing comprehensive record-keeping capabilities.
5. Management Certification (Section 302)
5.1 Certifications and Approvals
Light includes workflows for document approvals and certifications that allow senior executives, such as the CEO or CFO, to review and approve financial statements. This ensures that statements are accurate and complete before publication, meeting the executive certification requirements of SOX by enabling controlled review, approval, and evidenceable sign-off.
6. Real-Time Monitoring and Alerts
6.1 Real-Time Monitoring
Light provides real-time alerts and dashboards for financial activities. These tools help management monitor ongoing financial processes and identify potential issues or discrepancies before they become significant problems, ensuring continued SOX compliance.
6.2 Risk Management and Controls
The compliance modules integrated with Light can help identify, assess, and mitigate risks related to financial processes and reporting. This directly aligns with SOX’s focus on ensuring accurate financial reporting and maintaining effective internal controls. by supporting risk identification, control design, and ongoing monitoring.
7. Compliance Reporting Tools
7.1 Audit Management
Light offers comprehensive tools for managing audit processes, including tracking controls, identifying errors, and providing evidence of compliance. These tools facilitate the creation of audit reports and tracking of audit actions, which are critical for SOX compliance and for supporting auditor requests and evidence packages.
8. Data Security and Access Control (Section 404)
8.1 Role-Based Access Control (RBAC)
Light implements strict role-based access controls to ensure that sensitive financial data is only accessible to authorized individuals. This approach helps prevent fraud and ensures the integrity of financial information, which is critical for SOX compliance and consistent with least-privilege principles.
8.2 Secure Data Transmission
Light supports robust encryption and secure data transmission protocols to protect sensitive financial data from unauthorized access. This ensures compliance with SOX’s requirements for data protection and maintaining information integrity by protecting data in transit and reducing interception risk.
9. Security and Compliance Standards
9.1 SOC 2 Type II Compliance
Light is SOC 2 Type II compliant, which means the platform provides secure processing and storage of client data based on standards set by the AICPA. This certification demonstrates our commitment to the highest levels of data security and privacy.
9.2 ISO Certification
All Light servers are ISO-certified, ensuring that our infrastructure meets rigorous international standards for quality and security. This includes comprehensive security protocols and backup strategies that enhance data resilience.
9.3 SSL Security
Light secures its entire codebase with advanced SSL encryption, providing comprehensive protection against a broad range of potential cyber threats. This includes end-to-end encryption of data transmission and protection against various security risks.
9.4 Advanced Authentication
Light offers state-of-the-art authentication technology designed to provide maximum security while maintaining user convenience. This includes strong multi-factor authentication, role-based access permissioning, and advanced identity verification mechanisms.
10. Compliance Assurance and Ongoing Commitment
Light is committed to maintaining the highest standards of compliance and data security.
By aligning with SOX, SOC 2 Type II, and other industry best practices, we ensure financial data integrity, transparency, and resilience.
Our ongoing compliance initiatives, robust security measures, and audit-ready reporting empower organizations to meet regulatory requirements with confidence and ease.
SOC 1 (Public-Company Readiness): Light is on track to deliver SOC 1-level controls and a SOC 1 report to support customer SOX programs where Light is in scope for ICFR and third-party assurance is requested by auditors.