Sarbanes-Oxley Act

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Sarbanes Oxley Act of 2002

Legislation in the United States, passed in 2002, intended to increase transparency in accounting practices. It was adopted in the wake of a series of scandals involving aggressive accounting on the part of a number of major accounting firms, notably Arthur Andersen. Among other provisions, it created the Public Accounting Oversight Board to regulate accounting firms that provide auditing services. It established and enhanced provisions for auditor independence and financial disclosures to limit potential conflicts of interest. It introduced a requirement that the chief executive officer must sign a corporation's tax return and enhanced punishments for white collar crime. Proponents argue that the Act has increased transparency in public accounting, while critics contend that it has driven business outside the United States.

Sarbanes-Oxley Act

The congressional legislation that regulates certain corporate financial activities and improves the accuracy of financial statements. Among other things, the act prohibits personal company loans to directors and officers, requires certification of financial statements by a firm's chief executive officer and chief financial officer, protects employee whistle-blowers, increases criminal penalties for securities law violations, requires disclosure of off-balance-sheet financing, and calls for improvement in the accuracy of pro forma financial statements. The act was passed in 2002 in response to widely publicized corporate accounting scandals.

Sarbanes-Oxley Act

see CORPORATE GOVERNANCE.

Sarbanes-Oxley Act

see CORPORATE GOVERNANCE.
References in periodicals archive ?
We define Adjusted diluted earnings per share as diluted earnings per share, adjusted for M&A expenses, incremental SOX 404 compliance expense and tax benefit from worker opportunity tax credits.
The SEC provided a partial quantification of the costs of its rules under SOX 404.
Understanding that SOX 404 is an ongoing effort, Harrer spends an entire chapter on project management, emphasizing the importance of hiring qualified staff, organizing the SOX team in an effective manner, and continuing to educate the entire business staff on the importance of the SOX effort in order to strengthen overall buy-in within the business for improving the effectiveness of internal controls.
24) Since 2003, the company has implemented tight internal control procedures in order to comply with SOX 404, meet American stockholder demands, and adhere to LSF norms in France.
Former SEC chairmen Paul Volcker and Arthur Levitt have asserted that SOX 404 costs exemplify long-term investments in corporate responsibility that strengthen market efficiencies and reduce market risk (Volcker and Levitt, 2004).
Controversy over the implementation of SOX 404 has led the SEC and the PCAOB to two basic, but important, conclusions:
The study was performed on a small public company client that voluntarily complied with SOX 404.
Obtain invaluable evidence of compliance for SOX 404, HIPAA, 21 CFR part 11, Basel II, GLBA, and similar regulations
Obtain a unified view into multi-platform database deployments * Discover and inventory versions and patch levels across the entire database population * Track database configuration and design in a central location * Dynamically provision database resources to meet business SLAs * Clone databases to support testing and rollout of new products * Deploy patches in minutes to hundreds of databases * Automatically repair faults in database operation * Scale database capacity on demand and online * Enables the rapid deployment of business continuity and disaster recovery relationships * Log all database accesses and other pertinent activity in a secure, write-once format * Obtain invaluable evidence of compliance for SOX 404, HIPAA, 21 CFR part 11, Basel II, GLBA, and similar regulations
SOX 404 compliance costs are expected to be 63 percent more on average than original estimates, according to Financial Executives International (FEI).
Audit Fees and SOX 404 Auditor Attestation Filer Growth (Table)