Sarbanes-oxley

was introduced in 2002 as a result of corporate scandals which usurp millions . This provides security from future scandals The law has 11 major bread and butter (Linsely 2003 . A Public Accounting Board was created in to run through the Securities Exchange Commission in auditing . No longer be non auditing services able to be hired to perform core audits . This is to ensure that the responsibility of the audit remain within these companies . The come before auditor may not serve a vocal beyond five years . Management may not monitor the auditing commissioning . These individuals be required to report to the auditing flourish panel . Newly , the members of the auditing board moldiness not be connected or receive some(prenominal) other capital from the high society for any other service in which they are auditing . The auditing committee monitors the auditors instead of management . Most importantly , company chief executive officer s and CFO s are being held accountable for their firms pecuniary evincements . They are required to state these financial records and explain them . Additionally , escape of compliance in describe for go away cost these companies to birth back any money that they received from the statements that were inaccurately account . This leaves companies in a situation where they will be creditworthy for their own financial records . If not , they will lose great(p) . Officers cannot make trades of stock during a black out finale . Any off equilibrate must be report and explained .

Additionally , management must provide a break down analysis and prove the potential causes . Lastly , the annual reporting process straight includes analysis on how effective their infixed controls are . These eleven furnish simplistically hold companies accountable for their financial actions . It requires them to have a colossal knowledge of what is going on with their company financially . It in any case requires an explanation of their financial consideration . This law requires compliance by corporations . Best of all , the penalty will affect the directors and managers of these corporations straight off , which is assurance of accuracy When companies will pay for their own deceptions , chances are they will make an sweat to complyReferencesLinsley , Colin (2003 . Auditing , Risk Management and a Post World . palingenesis of Business , pp . 21-25...If you want to get a full essay, distinguish it on our website: BestEssayCheap.com

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