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The Sarbanes-Oxley Act (SOX) --can a law guarantee the accuracy of public financial statements?
Finance & Accounting
Pages 3 (753 words)
The Sarbanes-Oxley Act (SOX) Name: Course: Instructor: Date: The Sarbanes-Oxley Act (SOX) Studies indicate that after the accounting scandal involving Arthur Anderson and the collapse of WorldCom and Enron in period between 2001vto 2002, many stakeholders; the American public, investors, and the government sought for reforms that targeted corporates in the United States.
It was the Sarbanes-Oxley Act (SARBOS/SOX), which was passed by the Congress in the year 2002 to address the concerns by setting standards, which guarantees the accuracy of fiscal intelligences. The SOX Act was created to make executives responsible for corporation accounting statements, regulating internal audit systems of public businesses, and redefining the relationships between organizations, including their respective auditors. In financial view, SOX is the most important set of organizational or corporate governance, including legislative disclosure; it replaced the SEX act of the year 1934 and the 1933 security act. Thus, it becomes very essential for the benefit of both American public and the investors. How the law guarantees accuracy To begin with, the first part of the Act is essential and responsible for the establishment of the public company accounting oversight board (PCAOB), which works in overseeing the public companies auditors; this has a goal of offering protection of the interests of the public and investors; this comes in the process of preparing informative, independent, and fair intelligences. ...
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