Oxley

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The Sarbanes-Oxley Act of 2002 is a United States federal law. It is legislation that was introduced proposing changes to regulating the financial practices as well as regulations pertaining to corporate governance, auditor independence, internal control assessment, and enhanced financial disclosure. It also sets several deadlines for compliance. This piece of legislation is named after its two major contributors that of Senator Paul Sarbanes and Representative Michael Oxley. The act arrangement is under eleven section or titles; however, some of the sections of the Sarbanes-Oxley Act of 2002 are considered to be more important than others, mainly 302, 401, 404, 409, 802 and 906 (full act available on-line at http://www.law.uc.edu/CCL/SOact/toc.html). SOX was a swift reaction to public outcry following corporate scandals, Congress imposed new obligations on directors, executives, lawyers, accountants, and many other entities. Many argue that this was done without due consideration to the Act's possibly adverse effects. The Sarbanes-Oxley Act of 2002 was introduced following a number of court cases of fraud and mismanaging of financial statements by major corporations (e.g., Enron and others). It was deemed necessary because it was quite obvious from the growing number of corporate scandals and resultant public outrage that the corporate world needed more oversight as more and more questionable corporate acts and financial manipulations took center stage in the media and the courts. This means that the quick response of Congress-and the Sarbanes-Oxley Act of 2002 (SOX) was created mainly to bolster the public's confidence in corporate governance and financial reporting of the public companies mainly through rebuilding public trust in corporations and capital markets

In other words, the new law was in reaction to several main corporate and accounting…...

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