The Sarbanes-Oxley is the act of 2002. This act consist of originals names of the Investors Confident Act, Public Company Accounting Reform, Corporate Accountability Act, Investors Protection Act of 2002, and many more. The main purpose of these Acts is to focus on legislation. This Act is to support the public with support, and to maintain at a high level of confidence in the financial reports of public companies. SOX were introduced to be known with its purpose. SOX is an act in protecting investors by improving the accuracy, and reliability of corporate disclosures made pursuant to the securities laws, and other purposes. New parts of the law are cited at 15 USC 7201. Many provisions is located at 78 USC because many of the provisions amend the securities exchange Act of 1934 (M. Jennings, 2012).
The Sarbanes-Oxley Act of 2002 is a federal law enacts in response to corporate, and accounting scandals that may lead to bankruptcies or stock losses. Enron, WorldCom, and Tyco are corporations with corruptions were acting unethical by committing accounting errors and fraudulent practices by management leaders who caused scandals in 2001. The investors began to lose billions of dollars when the stock prices began to decline because of scandals. During this time, the public is losing confidence in the capital markets.
Representative Michael Oxley and Senator Paul Sarbanes are the main supporters of the law who combines and formed the Sarbanes-Oxley act of 2002. Their goals are improving the accuracy and reliability of corporate disclosure. This is a pass law because the need of correcting corporate scandals that involves companies such as, Enron, WorldCom, and Tyco.
The requirement of the Sarbanes-Oxley Act of 2002 is to follow its strict guidelines in disclosure of financial information. The law is to demonstrate to organizations on how to conduct accounting practices with high standards of integrity. This law contains 11 titles, and its purpose...