Sarbanes-Oxley Act

Before the signing ceremony of the Sarbanes-Oxley Act, President George W. Bush meets with Senator Paul Sarbanes, Secretary of Labor Elaine Chao and other dignitaries in the Blue Room at the White House on July 30, 2002.

The Sarbanes-Oxley Act of 2002 (Pub.L. 107-204, 116 Stat. 745, enacted 2002-07-30), also known as the Public Company Accounting Reform and Investor Protection Act of 2002 and commonly called SOx or Sarbox; is a United States federal law enacted on July 30, 2002 in response to a number of major corporate and accounting scandals including those affecting Enron, Tyco International, Adelphia, Peregrine Systems and WorldCom. These scandals, which cost investors billions of dollars when the share prices of the affected companies collapsed, shook public confidence in the nation's securities markets. Named after sponsors Senator Paul Sarbanes (D-MD) and Representative Michael G. Oxley (R-OH), the Act was approved by the House by a vote of 423-3 and by the Senate 99-0. President George W. Bush signed it into law, stating it included "the most far-reaching reforms of American business practices since the time of Franklin D. Roosevelt."[1]

The legislation establishes new or enhanced standards for all U.S. public company boards, management, and public accounting firms. It does not apply to privately held companies. The Act contains 11 titles, or sections, ranging from additional Corporate Board responsibilities to criminal penalties, and requires the Securities and Exchange Commission (SEC) to implement rulings on requirements to comply with the new law. Debate continues over the perceived benefits and costs of SOX. Supporters contend that the legislation was necessary and has played a useful role in restoring public confidence in the nation's capital markets by, among other things, strengthening corporate accounting controls.

The Act establishes a new quasi-public agency, the Public Company Accounting Oversight Board, or PCAOB, which is charged with overseeing, regulating, inspecting, and disciplining accounting firms in their roles as auditors of public companies. The Act also covers issues such as auditor independence, corporate governance, internal control assessment, and enhanced financial disclosure.
Contents
1 Overview
2 History & context: events contributing to the adoption of SOX
2.1 Timeline and passage of SOX
3 Analyzing the cost-benefit of Sarbanes-Oxley
3.1 The effect of SOX on non-US companies
4 Implementation of Key Provisions
4.1 SOX Section 302: Internal control certifications
4.2 SOX Section 404: Assessment of internal control
4.3 SOX 404 and smaller public companies
4.3.1 SOX 404 and information technology
4.4 SOX Section 802 Criminal Penalties for Violation of SOX
4.5 SOX Section 1107 Criminal Penalties for Retaliation Against Whistleblowers
5 Criticism
6 Legislative information
7 References
8 See also
8.1 Similar laws in other countries
9 External links

more

Accounting Oversight Information Center
SEC-Rules
Sarbanes-Oxley SEC Rules & Regulations
As directed by the Sarbanes-Oxley Act of 2002, the SEC is adopting rules that require conformance with specific sections of the Act. These rules require officers to certify that they are responsible for establishing, maintaining and regularly evaluating the effectiveness of the issuer's internal controls; that they have made certain disclosures to the issuer's auditors and the audit committee of the board of directors about the issuer's internal controls; and that they have included information in the issuer's quarterly and annual reports about their evaluation and whether there have been significant changes in the issuer's internal controls or in other factors that could significantly affect internal controls subsequent to the evaluation.
Posted on November 19, 2002
IC-Primer
Sarbanes-Oxley Disclosure/Internal Controls
This Sarbanes-Oxley dislcosure/internal control primer includes chapters on internal control framework, audit considerations, methodology, risk/control matrices, self-assessment questionnaires, and audit programs relating to Sections 302 and 404 regarding Certification of Disclosure and Mangements’ Internal Controls and Procedures. Forms may be prepared either independently by the client or with the assistance of the practitioner engaged to develop, implement and perform the internal controls evaluation process. The risk/control matrices, self-assessment questionnaires and audit programs are based on the framework established by COSO/SAS-78.
Posted on November 19, 2002
Sarbanes-Oxley
Sarbanes-Oxley Act of 2002
To improve quality and transparency in financial reporting and independent audits and accounting services for public companies, to create a Public Company Accounting Oversight Board, to enhance the standard setting process for accounting practices, to strengthen the independence of firms that audit public companies, to increase corporate responsibility and the usefulness of corporate financial disclosure, to protect the objectivity and independence of securities analysts, to improve Securities and Exchange Commission resources and oversight, and for other purposes.
Posted on November 19, 2002
SOA-Manual
Sarbanes-Oxley Compliance Manual
This Sarbanes-Oxley accounting oversight compliance manual includes a list of key dates/timetable, self-assessment questionnaires, and definitions relating to Titles II and III regarding Auditor Independence and Corporate Responsibility. Forms may be prepared either independently by the client or with the assistance of the practitioner engaged to perform the accounting oversight compliance services. Each of the questions listed in the questionnaires are based on specific sections listed within Titles II and III of the Sarbanes-Oxley Act of 2002.
Posted on November 19, 2002

more