Fraudulent Corporate Scandals

2028 Words Feb 2nd, 2018 8 Pages
These corporate executives kept stretching out of moral and ethical bounds. In many instances, enriching themselves at the expenses of their thereby crossed also the legal lines. However, it was just a matter of time before the lids would be blown off to those boiling pots. The much needed blowup was offered by the massive scandals at Enron and Worldcom followed by Adelphia and the rest. In their efforts to restore investors’ confidence in the capital market, the United States’ Congress enacted Sarbanes-Oxley Act in 2002 (SOX). The SOX had ambitious goals to fix the root cause of the failures in corporate America, accountabilities in the boardrooms (Grasso, Tilley, & White, 2009: Kessel, 2011). In particular, the Act ensures that accounting records and reports are fairly presented and reliable (Verschoor, 2012: Aubert & Grudnitski, 2013). SOX achieves these by requiring certifications by the Chief Executive Officers (CEO) and the Chief Financial Officers (CFO). In addition, attestations by independent auditors of accuracies of the financial reports and internal controls over the accounting records.
The key ethical components of the SOX
The fraudulent corporate scandals that necessitated the enactment of…
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