Glossary

 
 

 
 
AICPA – American Institute of Certified Public Accountants.

AMEX – American Stock Exchange.

AML – Also known as "anti-money laundering." Following the passage of the U.S. Patriot Act of 2001, the number and type of organizations that need to monitor and report money laundering activities significantly increased.

Basel I – Enacted in 1988, Basel I provided a framework for international bank capital standards and the risks these banks assume. (Source: Bank for International Settlements)

Basel II – Seeks to improve on the existing rules from Basel I by aligning regulatory capital requirements more closely to the underlying risks that international banks face. (Source: Bank for International Settlements)

COSO – The Committee of Sponsoring Organizations of the Treadway Commission. Originally formed in 1985 to sponsor the National Commission on Fraudulent Financial Reporting. (Source: COSO)

e-Discovery – Also known as "electronic discovery," this refers to the mass quantities of electronic data (e.g., e-mails, databases, Word documents, instant messages, websites) that may be reviewed during the discovery phase of a lawsuit.

ERM – Enterprise Risk Assessment.

ERP – Enterprise Resource Planning.

The Exchange Act – Refers to the Securities and Exchange Act of 1934, which established the SEC and the core federal securities laws. (Source: U.S. Securities and Exchange Commission)

FDIC – Federal Deposit Insurance Corporation. The FDIC was created in 1933 to preserve and promote public confidence in the U.S. financial system by insuring deposits in banks and thrift institutions for at least $100,000. (Source: FDIC)

FDICIA – Federal Deposit Insurance Corporation Improvement Act of 1991. The FDICIA established for the first time statutory requirements for both risk-based capital and the leverage ratio, and a system of prompt corrective action to enforce capital requirements. (Source: FDIC)

GAAP – Generally accepted accounting principles. These are the standards, which vary by country, for financial accounting and for preparing financial statements.

GRC – Governance, Risk and Compliance.

HIPAA – The Health Insurance Portability and Accountability Act of 1996. HIPAA created national standards to protect individuals' medical records and other personal health information. (Source: U.S. Department of Health and Human Services, Office for Civil Rights)

The IIA – The Institute of Internal Auditors. Established in 1941, The IIA is the international professional association for internal auditors. (Source: The IIA)

NASDAQ – The computerized stock exchange established by the National Association of Securities Dealers in 1971.

NYSE – The New York Stock Exchange.

PCAOB – The Public Company Accounting Oversight Board. Established by the Sarbanes-Oxley Act, the PCAOB oversees the audits of the financial statements of public companies. (Source: The PCAOB)

Sarbanes-Oxley Act of 2002 – Corporate governance and oversight legislation signed into law on July 30, 2002. Also referred to as "Sarbanes-Oxley," "SOA," "SOX," and "the Act." (To access the full text of the Sarbanes-Oxley Act, please visit: http://pcaobus.org/About/History/Documents/PDFs/Sarbanes_Oxley_Act_of_2002.pdf)

SEC – The U.S. Securities and Exchange Commission.

Section 302 – Refers to Section 302 of the Sarbanes-Oxley Act, which addresses certifications by the principal executive officer (the CEO) and principal financial officer (usually the CFO).

Section 404 – Refers to Section 404 of the Sarbanes-Oxley Act, which addresses internal control over financial reporting.

Section 906 – Refers to Section 906 of the Sarbanes-Oxley Act, which requires an executive certification stating that a company's periodic report containing its financial statements fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act, and that the information contained in the periodic report fairly presents, in all material respects, the financial condition and results of operations of the issuer.

Title IV – Refers to Title IV of the Sarbanes-Oxley Act. This is the section that covers enhanced financial disclosures.