Reading:

? AICPA. (2009). Sarbanes-Oxley – the basics. Retrieved on March 1, 2009 from http://thecaq.aicpa.org/Resources/Sarbanes Oxley/Sarbanes-Oxley %E2%80%93 The Basics.htm

? International Chamber of Commerce. (2009). Corporate governance. Retrieved on March 1, 2009 from http://www.iccwbo.org/corporate-governance/

The Sarbanes-Oxley Act (SOX), which was signed into law in July 2002. This legislation was intended to improve the accuracy of the financial statements prepared by publicly held companies. Carefully read the summary of this Act.

Discuss the likely effects of the Sarbanes-Oxley Act:

1. Discuss how the Sarbanes-Oxley Act is likely to affect audit committees of public company boards of directors.

2. Discuss how the Sarbanes-Oxley Act is likely to affect the CEO’s and CFO’s of public companies.

3. Discuss how the Sarbanes-Oxley Act is likely to affect outside independent audit firms..

4. Discuss section 404 of the Sarbanes-Oxley Act and its affect on internal control.

5. Discuss how the Sarbanes-Oxley Act is likely to affect the accuracy of public company financial statements and the cost of capital for public companies.

6. Discuss the main advantages and disadvantages of the Sarbanes-Oxley Act.

7. Discuss what changes should be made to the Sarbanes-Oxley Act.

If you believe that legislation can guarantee the accuracy of public company financial statements, please explain why previous laws have failed. If you believe that the reverse is true, please explain why CEOs and CFOs are paying so much attention to this law.

Objectively present all sides of the particular issue and provide specific, factual answers with supporting documentation. Don’t provide subjective speculation or opinion without any support your conclusions.

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