This paper provides a brief but complete introduction of the Sarbanes- Oxley Act (SOX). After providing the aims that were pursed by the United States legislation by introducing this act, the paper gives an overview of the provisions of the Sarbanes- Oxley Act.
This overview deals with every single provision and describes the inherent measures.
Ultimately the last section of this paper delivers an overview of the criticism raised by different scholars and experts concerning the Sarbanes- Oxley Act.
Table of Contents
- Preface
- 1. Introduction
- 2. Aims and general measures of the Sarbanes-Oxley Act
- 3. Provisions of the Sarbanes-Oxley Act
- 4. Criticism on the Sarbanes-Oxley Act
- Sources
Objectives and Key Themes
This paper aims to provide a concise yet comprehensive overview of the Sarbanes-Oxley Act (SOX) of 2002. It explores the Act's objectives, key provisions, and the criticisms it has faced. The paper seeks to illuminate the impact of SOX on corporate governance and financial reporting in the United States.
- The aims and general measures of the Sarbanes-Oxley Act.
- The key provisions of the Sarbanes-Oxley Act across its various titles.
- Criticisms and implications of the Sarbanes-Oxley Act.
- The impact of SOX on corporate responsibility and auditor independence.
- The role of the Public Company Accounting Oversight Board (PCAOB).
Chapter Summaries
1. Introduction: This chapter introduces the Sarbanes-Oxley Act (SOX) as a landmark securities legislation passed in the wake of major accounting scandals. It highlights the Act's official title and its common name, explaining its origins and the individuals responsible for its creation. The chapter establishes the Act's mandatory application to all public companies listed on US capital markets, including foreign companies seeking access to these markets. It previews the paper's structure, outlining the subsequent sections that will detail the Act's aims, provisions, and criticisms.
2. Aims and general measures of the Sarbanes-Oxley Act: This chapter outlines the primary objective of SOX: to ensure investor confidence in the accuracy and reliability of financial information published by public companies. It details the Act's mechanisms for achieving this, focusing on the re-allocation of responsibilities and liabilities for company managers, executive directors, and auditors. The chapter emphasizes the tightening of auditor liability, the establishment of higher standards for financial reporting, and the precise definition of the auditor-client relationship. The creation of the Public Company Accounting Oversight Board (PCAOB) is presented as a crucial element in enhancing oversight and accountability.
3. Provisions of the Sarbanes-Oxley Act: This chapter delves into the specific provisions of SOX, focusing on key aspects of its various titles. It details the establishment of the PCAOB and its regulatory function, as well as the regulations concerning auditor independence, including restrictions on the types of services auditing firms can provide to their clients. The chapter also discusses the requirements for company audit committees, CEO and CFO certifications of financial statements, and prohibitions against misleading or manipulating auditors. It highlights the importance of Section 404, mandating internal control reports with annual reports.
4. Criticism on the Sarbanes-Oxley Act: [This section is excluded as per instructions to avoid summarizing the conclusion or final chapter.]
Keywords
Sarbanes-Oxley Act (SOX), corporate governance, financial reporting, auditor independence, Public Company Accounting Oversight Board (PCAOB), accounting fraud, investor protection, corporate responsibility, internal controls, securities legislation.
Sarbanes-Oxley Act (SOX) of 2002: A Comprehensive Overview - FAQs
What is the purpose of this document?
This document provides a comprehensive preview of a paper on the Sarbanes-Oxley Act (SOX) of 2002. It includes the table of contents, objectives and key themes, chapter summaries (excluding the conclusion), and keywords. The information is intended for academic use and analysis of themes within the SOX act.
What topics are covered in the Sarbanes-Oxley Act (SOX) paper?
The paper covers the aims and general measures of the Sarbanes-Oxley Act, its key provisions across its various titles, criticisms of the Act, the impact of SOX on corporate responsibility and auditor independence, and the role of the Public Company Accounting Oversight Board (PCAOB).
What are the main objectives and key themes of the paper?
The main objective is to provide a concise overview of the SOX Act, exploring its objectives, key provisions, and criticisms. Key themes include investor confidence in financial reporting, corporate governance, auditor independence, the role of the PCAOB, and the impact of SOX on US financial markets.
What is covered in the Introduction chapter?
The introduction chapter introduces the Sarbanes-Oxley Act as landmark legislation passed after major accounting scandals. It details the Act's official and common names, its origins, and its mandatory application to US-listed public companies, including foreign companies. It also outlines the paper's structure.
What is discussed in the chapter on the Aims and General Measures of the Sarbanes-Oxley Act?
This chapter focuses on SOX's primary objective: ensuring investor confidence in the accuracy of financial information. It details mechanisms like re-allocation of responsibilities and liabilities for company managers, executives, and auditors; tightening auditor liability; higher standards for financial reporting; and the creation of the PCAOB.
What are the key topics covered in the chapter on the Provisions of the Sarbanes-Oxley Act?
This chapter delves into specific provisions, including the establishment and regulatory function of the PCAOB, regulations on auditor independence, requirements for company audit committees, CEO and CFO certifications of financial statements, and the importance of Section 404 (internal control reports with annual reports).
Why is there no summary of the chapter on Criticism of the Sarbanes-Oxley Act?
The summary of the chapter on criticisms of the Sarbanes-Oxley Act has been excluded as per the instructions.
What are the keywords associated with the Sarbanes-Oxley Act (SOX) paper?
Keywords include: Sarbanes-Oxley Act (SOX), corporate governance, financial reporting, auditor independence, Public Company Accounting Oversight Board (PCAOB), accounting fraud, investor protection, corporate responsibility, internal controls, and securities legislation.
What is the intended audience for this document?
This document is intended for academic use, supporting structured and professional analysis of themes related to the Sarbanes-Oxley Act.
- Quote paper
- Andreas Bauer (Author), 2007, The Sarbanes- Oxley Act - A brief introduction , Munich, GRIN Verlag, https://www.grin.com/document/94421
