Sarbanes-Oxley
Post-Enron financial regulation
Sarbanes-Oxley is a 2002 U.S. federal law enacted after major corporate accounting scandals at Enron and WorldCom.
It established stricter financial reporting requirements, mandated internal controls, and created the Public Company Accounting Oversight Board.
Often shortened to SOX, it applies to publicly traded companies and their auditors: We spent months preparing for our SOX compliance audit.
Failed energy corporation
- 2002Early 2000s date
- SECStock market regulator
- CongressU.S. lawmaking body
- investor protectionLaws shielding capital providers
securities law · federal law · corporate fraud · public company · rulemaking · enforcement · financial scandal · bipartisan
Board subgroup reviewing finances
- whistleblower protectionLaws shielding those who report misconduct
- oversightSupervision or inadvertent omission
- fiduciary dutyObligation to act loyally
- corporate responsibilityCompany's ethical and social obligations
Organizational oversight procedures
- auditFormal accounts examination
- disclosureAct of revealing information
- certificationAttestation of qualification
- attestationFormal declaration confirming truth
remediation · deficiency · documentation · testing · risk assessment · compliance officer · audit trail
Degree of correctness
- financial statementsFormal records of transactions
- 10-KMandatory yearly SEC filing
- internal auditIn-house compliance review
- external auditOutside accountant's formal examination
restatement · annual report · GAAP · earnings · footnotes · financial integrity
Enron
Failed energy corporation
investor protection · securities law · federal law · corporate fraud · public company · rulemaking · enforcement · financial scandal · bipartisan · regulation
audit committee
Board subgroup reviewing finances
- whistleblower protectionLaws shielding those who report misconduct
- oversightSupervision or inadvertent omission
- fiduciary dutyObligation to act loyally
corporate responsibility · ethics code · clawback · accountability · transparency
internal controls
Organizational oversight procedures
- auditFormal accounts examination
- disclosureAct of revealing information
- certificationAttestation of qualification
attestation · remediation · deficiency · documentation · testing · risk assessment · compliance officer · audit trail
accuracy
Degree of correctness
- financial statementsFormal records of transactions
- 10-KMandatory yearly SEC filing
- internal auditIn-house compliance review
external audit · restatement · annual report · GAAP · earnings · footnotes · financial integrity
- complianceaudit, obeying, policy, compliance officer, regulation
- Federal Lawsfederal laws, congressional acts, acts, Civil Rights Act, Clean Air Act
- financial reformbank reform, tax reform, budget reform, pension reform, banking oversight
- U.S. LawsCivil Rights Act, Americans with Disabilities Act, Clean Air Act, Clean Water Act, HIPAA
- auditingauditor, audit trail, audit trails, auditors, audit report
- Securities LawSEC, securities, securities fraud, insider trading, prospectus