SOX Compliance Checklist: What Security Teams Need to Know in 2025
SOX compliance isn’t just for finance departments. For cybersecurity and IT leaders, the Sarbanes-Oxley Act of 2002 (SOX) has become a cornerstone of accountability—with serious implications for how organizations manage data security, third-party risk, and compliance reporting.
Failure to meet SOX compliance standards can result in steep penalties, criminal liability, reputational damage, or even public restatement of financial statements. In 2025, with more pressure from regulators and the Securities and Exchange Commission (SEC), the stakes are high for publicly traded companies and their partners.
1. Understand What SOX Covers
SOX applies to all publicly traded U.S. companies and their subsidiaries. It requires organizations to maintain an adequate internal control structure for accurate financial reporting. In practice, that includes IT systems, cyber controls, and access management. The foundation of this oversight is the internal control report, which auditors rely on to verify safeguards.
Why it matters: If a cyber event compromises the integrity of financial data, it may result in SOX compliance violations. For example, ransomware that locks out access to financial systems or third-party data leaks tied to financial processing systems may trigger corporate disclosures and violations.
Establishing a comprehensive inventory of financial systems and their reporting dependencies—including connected infrastructure, cloud applications, and third-party services—helps position organizations for effective SOX compliance and audit readiness.
2. Implement Controls for IT Change Management
SOX Section 404 requires formal internal controls over systems that impact financial reporting. This includes how organizations document, approve, and validate changes—such as software updates, infrastructure modifications, or permission alterations. All changes to SOX-relevant systems must be controlled under an internal control framework.
What to do:
- Require approval workflows for changes to SOX-relevant systems
- Automate audit trails for system changes and versioning
- Limit accounts that can make production-level changes
Strong change management practices reduce the risk of unauthorized system alterations, improve auditability, and help ensure the integrity of financial data.
3. Control Access to Financial Systems
One of the most critical cybersecurity practices for SOX compliance is implementing strict access controls around financial systems and data. Under SOX Section 404, organizations must demonstrate that only authorized personnel can access systems that impact financial reporting—and that these controls are enforced and regularly reviewed.
Your checklist:
- Enforce role-based access and least privilege policies
- Require multi-factor authentication (MFA)
- Maintain detailed access logs of who accessed what, and when
Unauthorized access—whether from internal misuse or compromised vendor credentials—can lead to data tampering, financial misstatements, and audit failures. Proper access controls also serve as part of an organization’s broader password protection and data security strategy.
4. Monitor Third-Party Risk
Companies are responsible for maintaining effective internal controls over financial reporting—even if those systems or data are managed by third parties. As a result, governing vendor risk is crucial to SOX compliance.
What to monitor:
- Third parties with access to financial systems or data
- Vendor breach histories, risk ratings, and remediation timelines
- Contracts related to data security and control
SecurityScorecard’s SCDR helps you continuously assess third-party cyber posture and receive breach alerts tied to your cybersecurity ecosystem.
Explore how to build a stronger third-party risk management program in our Complete Third-Party Risk Management Guide.
5. Establish a Cyber Incident Response Plan
Any cybersecurity event that compromises financial systems, records, or access controls can affect the integrity of internal controls over financial reporting (ICFR)—and potentially trigger auditor or regulatory scrutiny.
Key steps:
- A documented incident management system
- Defined escalation paths for SOX-relevant incidents
- Coordination with legal, compliance, and executive teams
With SCDR, you can detect supply chain issues faster and coordinate response with at-risk third parties in real time. Security breaches tied to your financial environment can increase scrutiny from the accounting oversight board.
6. Maintain Audit Trails and Logs
All systems impacting SOX-relevant financial data should generate logs that support traceability, accountability, and audit readiness.
Your checklist:
- Ensure log integrity and centralized storage
- Correlate logs with identity and activity data
- Protect logs from tampering
Missing or compromised logs can impact a compliance audit, exposing public companies to regulatory scrutiny from the SEC.
7. Test and Certify Controls Regularly
Under SOX Section 302, SOX requires executives, such as the chief executive officer and chief financial officer, to provide quarterly and annual certification of the effectiveness of internal controls. Security teams should regularly test the controls maintained around financial systems.
Important metrics:
- Vulnerability scanning and maintaining patching cadence
- Access review testing and separation of duties checks
- Incident detection and alerting validation
MAX provides continuous monitoring of third-party cyber risk, so you can hold vendors to the same audit-ready standards you apply internally.
8. Document Everything
Documentation is the backbone of any SOX compliance checklist. It is a best practice to clearly document every policy, procedure, and control related to financial reporting to support internal and external audit requirements.
Must-haves:
- IT security policies and change management documentation
- Risk assessments and third-party evaluations
- Evidence of training and control testing
Ensure your documentation is current, accessible, and mapped to SOX-relevant systems—including those managed by vendors. Documentation supports your broader corporate governance strategy and enables consistency across financial statements and disclosures.
If you’re looking to improve visibility and control, explore these best practices for compliance monitoring in cybersecurity to keep pace with evolving requirements.
Make SOX Readiness a Competitive Advantage
Regulatory risk is business risk. As auditors focus more on security maturity, cybersecurity leaders must help close the gap between IT risk and financial compliance.
SecurityScorecard makes SOX compliance easier by:
- Continuously monitoring your cyber posture and that of your vendors
- Providing actionable risk insights aligned to your infrastructure
- Offering SCDR and MAX services to support readiness, breach detection, and supply chain security
The benefits of SOX compliance extend far beyond avoiding penalties. They create a resilient organizational posture that can improve investor confidence, strengthen financial reporting accuracy, and demonstrate a proactive approach to cyber risk.
SecurityScorecard enables public companies and their partners to improve internal control frameworks with actionable intelligence. With a unified view of your financial ecosystem, you can respond quickly to incidents, validate vendor controls, and meet evolving compliance needs with confidence.
Discover the Full Value of SCDR
SecurityScorecard’s Supply Chain Detection and Response (SCDR) gives you real-time insight into financial system risk and third-party exposures. Get ahead of audits with vendor ratings, breach alerts, and risk mitigation tools built for compliance.
