Sarbanes Oxley Review
Sarbanes- Oxley Article Review
February 22, 2013
Still Debating the Merits of Sarbanes-Oxley, 10 Years Later (Dunn, 2012)
Sparking the 10-year anniversary of the passing of the Sarbanes-Oxley Act of 2002 comes some controversy regarding whether the law has proved to be useful, or more of a headache for companies in the United States. Following the huge accounting scandal at the Enron Corporation, the Sarbanes-Oxley Act was passed to change the compliance behind how companies would report their financials. Being enforced by the Securities and Exchange Commission (SEC), the SOX helps monitor corporate governance, reporting of financial statements, and accounting controls. Recently some more discussions arose concerning SOX at a new corporate social responsibility event called COMMIT! Forum. Questions surrounding if mandated corporate disclosure has done more good than bad was on the forefront. At the conference, Sen. Sarbanes referenced the ENRON scandal and how the market fell by trillions of dollars, including job cuts, and retirement savings exhausted. "That was the challenge the Senate Banking Committee faced," Sarbanes said. (Dunn, 2012) The senate Banking Committee was then tasked with identifying key problems in order tackle the areas of need, which included weak corporate governance procedures, inadequate oversight of auditors, and conflicts of interests held by the stock analysts. Mark Calabria, director of financial studies at the Cato Institute, argued that the new auditing procedures that must be adhered to because of the SOX, publicly traded companies are spending an average of two million dollars a year to comply. Calabria also stated that the Sarbanes-Oxley Act has also weakened the U.S. market by reducing the amount of companies going public. The SOX Act may affect ethical decision-making in today's business environment in more ways than one can imagine. Lauralee...
References: Dunn, C. (2012, October ). Still Debating the Merits of Sarbanes-Oxley, 10 Years Later . Corporate Counsel , (), . Retrieved from http://www.law.com
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