Enron Oxley Act ( Sox )

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Executive Summary
Over the last two decades the consulting practices within the Big Four accounting firms saw a variety of changes take place. This began when the accounting world was faced with multiple scandals around the turn of the century, which prompted the Sarbanes-Oxley Act (SOX). SOX mandated that public accounting firms could no longer provide both audit and consulting services to the same client. This forced the firms to brainstorm new ways to comply with the laws and standards, and overtime they created innovative ways to adhere to regulations. We examine the issues leading up to the new regulations, the Big Four firms’ reactions to the new regulations, and how consulting rebounded after SOX. We also analyzed what the consulting line of service at the Big Four will look like in the future and discuss why the Big Four firms want to preserve a presence in the consulting business. Overall, our research suggests that the consulting sector is lucrative, and the firms need revenues from non-audit clients in order to continue to grow their business.

Management Consulting’s Fall to SOX
The management consulting industry first gained popularity in the 1930s with the demand for advice on finance, strategy, and organizational design because of various government interventions. After World War 2, the development of globalization contributed to the boom in consulting industry.(O’Mahoney, 2010) Also, the increasing demand for strategy and information technology

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