A Brief Note On The Sarbanes Oxley Act Of 2002

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SOX- Is It Working? Leechelle Butts Indiana Wesleyan SOX- Is it Working? The Sarbanes-Oxley Act of 2002 is legislation passed by the U.S. Congress to protect shareholders and the general public from accounting errors and fraudulent practices in the enterprise, as well as improve the accuracy of corporate disclosures (Rouse & Spurzem, 2013). SOX were established as result of huge organizations being involved in financial indignity that happened in the early 2000s at popular companies such as Enron, WorldCom and Tyco that effected investors trust. One of the advantages of SOX is that companies are forces to be accountable for their work. They are no longer allowed to mislead investors for their own gain. Those that carry the responsibility of reporting financial information are now being held accountable for the way they choose to use their knowledge. The disadvantages are it is a costly process. It is a strict rule with high consequences, but no solid guideline on how to implement the system the act encounters. The act, was drafted by U.S. Congressman Paul Sarbanes and Michael Oxley, was aimed at improving corporate governance and accountability (Rouse & Spurzan, 2013). This act does not only effect the financial side of corporations, but also the IT departments charged with storing a corporation’s electronic records; a policy was put in effect of which records should be stored and for what length of time. The IT department is held accountable to store records

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