The details of internal control problems are most often provided in Item 9A—Controls
and Procedures in firms’ 10-Ks and Item 4—Controls and Procedures in firms’ 10-Qs. In
addition, managers often discuss internal control problems under Risk Factors in the
MD&A. At least 970 firms have disclosed at least one material weakness in internal control
from August 2002 to August 2005 under both Sections 302 and 404. We provide several
additional examples of material weakness disclosures in Appendix A.