The Effects of the Sox Act on Auditing

The Effects of the Sarbanes-Oxley (SOX) and the Public Companies Accounting Oversight Board (PCAOB) on Auditing Practices According to the SEC, On July 30th, 2002, President Bush signed into uprightness the Sarbanes-Oxley Act of 2002, which he characterized as the closely far reach reforms of American business practices since the time of Franklin Delano Roosevelt(SEC, 2012). The act put into exploit many reforms to enhance corporate responsibility, enhance pecuniary disclosures, and dodge corporate and accounting fraud(SEC, 2012). This act would lead the bash to the creation of the Public Company Accounting Oversight Board, which oversees auditing controls activities. The PCABO states, The PCAOB is a nonprofit corporation established by Congress to oversee the audits of public companies in order to cling to the interests of investors and further the public interest in the preparation of informative, immaculate and independent audit reports. The PCAOB also overs ees the audits of broker-dealers, including compliance reports filed pursuant to study securities laws, to promote investor protection (PCAOB, 2012). Both the Sarbanes-Oxley Act as hygienic as the PCAOB have an effect on auditing committees. The Sarbanes-Oxley Act has had a large impact on auditing.

According to Ken Tysiac, The closely controversial provision in SOX, Section 404, was in some(prenominal) demeanors ahead of its time with a focus on subjective control in addition to fiscals. AICPA President and chief administrator officer Barry Melancon said businesses are evolving in such a way that the question of how well thei r governing bodys perform might effect as ! important to investors as financial statements (Tysiac, 2012). Many companies demo not only financial statements to their investors, but also their system doing to potential investors. The Sarbanes-Oxley Act has forced businesses to look at separate factors in their audit then just a financial audit. Because of this, the audit committee must be responsible for more...If you wish to get a full essay, order it on our website: BestEssayCheap.com

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