Sarbanes-Oxley Paper - 723 Words

Sarbanes Oxley Paper The Sarbanes-Oxley (SOX) act was passed into law in 2002. It was created in response to major financial scandals that largely shook the publics confidence in corporate accounting practices. It was a significant response to improper record handling techniques. Under the law, corporate managers must assess whether they have sufficient safeguards to catch fraud and bookkeeping errors. There are consequences for not complying with the provisions of the act and there are certainly advocates and opponents of it. Price Waterhouse Coopers says Without a doubt, the Sarbanes-Oxley Act is the single most important piece of legislation affecting corporate governance, financial disclosure and the practice of public†¦show more content†¦This was considered an unprecedented level of accountability and would likely never have been possible without the public outcry from the scandals which made the act necessary. Sarbanes-Oxley is consistently called the broadest-sweeping legislation to affect corporations and public accounting since the 1933 and 1934 security acts, experts agree the resulting changes are just beginning (Fass, A. 2003). While The Sarbanes-Oxley act has a great deal of support, it is not a perfect solution. Alan Greenspan once called for changes to part of it and in fact called one of its provisions a nightmare. In addition, many companies have complained about what they consider to be the high cost and overhead needed to satisfy the SOX acts requirements. The main complaint about the act was the lack of specific details about what exactly was required. This along with the potential for fines and imprisonment led many companies to overspend on their SOX compliance initiatives. In response to these complaints, the Securities and Exchange Commission approved revised guidelines in 2007 that spelled out some of the rather vague requirements. The challenge has been to find th e right balance between financial reporting and efficiency in achieving it, the chairman of the SEC, Christopher Cox, said. TheShow MoreRelatedSarbanes-Oxley Act Research Paper1097 Words   |  5 PagesSarbanes-Oxley Act of 2002 Karla Azcue ACC 120-09 Mr. Donald Senior The Sarbanes-Oxley Act of 2002 is one of the most important legislations passed in the 21st century effecting financial practice and corporate governance. This act was passed on July 30, 2002 thanks to Representative Michael Oxley a republican from Ohio and Senator Paul Sarbanes a democrat from Maryland. They both passed two different bills that pertain to the same problem which had to do with corporations auditing accountabilityRead MoreSarbanes Oxley Act Research Paper1787 Words   |  8 Pagesï » ¿Sarbanes Oxley Act Research Project Brielle Lewis MBA 315 March 6, 2014 I. Abstract The purpose of the Sarbanes-Oxley Act is to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to the securities law, and for other purposes. (Lander, 2004) The Act created new standards for public companies and accounting firms to abide by. After multiple business failures due to fraudulent activities and embezzlement at companies such as Enron Sarbanes andRead MoreSarbanes Oxley Act Paper934 Words   |  4 PagesRunning Head: SARBANES OXLEY ACT Sarbanes Oxley Act Introduction Sarbanes Oxley Act is focused towards identifying accounting frauds in different public companies. This paper discusses about various reasons for the introduction of Sarbanes Oxley Act and causes that has been overlooked. 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