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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Sarbanes-Oxley Act

see CORPORATE GOVERNANCE.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

Sarbanes-Oxley Act

see CORPORATE GOVERNANCE.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
At least four major shocks occurred between 1997 and 2012 that affected the market for audit services: (1) preparing financial reporting and accounting databases for Y2K (1997-1999); (2) Enron and SOX (starting in 2002); (3) SOX 404 (starting in 2004); and (4) the financial crisis that began in 2008.
SOX required the SEC to enact regulations to carry out the goals of SOX 404. (158) The SEC did this in August 2003, a year after SOX's passage.
SOX 404 has received significant attention due to the perceived burden of the associated compliance costs.
More than half of companies complying with SOX expected that SOX 404 will do "very little" to help prevent material fraud.
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.
Firms that report remediation of previously reported ICDs and receive a clean SOX 404 audit opinion exhibit an increase in accrual quality.
My purpose is to extend their model by advocating the idea that companies should manage their internal control systems as an ongoing practice, not just as a one-time project designed to cope with SOX 404 or its international equivalents.
Some even combine workflow engines and document repositories to more fully incorporate the SOX 404 documentation requirements.
The purposes of this study are to review the implications of SOX 404, to assess SOX 404's potential impact on worldwide securities regulation, assess the impact of SOX 404 on external audit fees for the initial group of filers during the first 2 years it was effective and assess SOX 404's prospective economic impact on foreign companies that cross list their securities in the U.S.
* Also in November, FERF released SOX 404 Optimization: Operational Trends, Accelerated filers that have made efforts to optimize their Section 404 compliance programs have typically followed a three-stage journey: a huge initial effort to achieve compliance; a first rationalization initiative to eliminate wasted time and effort; and another effort to pursue a top-down, risk-based approach prescribed by Auditing Standard 5 (known as AS5).