Unintended Consequences of Sox

Enron, Global Crossing, Tyco, Adelphia and WorldCom became associated with phrases such as lack of independence, subversion of original responsibilities and financial irregularities. The Sarbanes ? Oxley Act of 2002 (SOX) was introduced to restore confidence in the form that is fundamental to our wealth creation. Congress knew what it must do, so Sarbanes- Oxley took the cue. To shore up corporate responsibility They made a law to test infixed control sufficiency. (Habbart) According to many this legislation misses its stated purpose. oppose views describe the Public Company Accounting Oversight board (PCAOB) as either the savior of financial reporting and terminator of corporate fraud or conversely, the guardian of government incumbrance and the annihilator of the accounting profession. (Raiborn and Schorg, 3) SOX is undeniably unpopular with many suggesting that the negative make impact both the audit processes and also corporate codes of bring and even whether companies will continue to list in the unify States. This paper looks at just some of the unintended consequences and confusedness arising from this legislative attempt to redress investor confidence.

Unintended Consequences This ?knee squeeze and unopposed legislation has had a negative impact on existing safeguards and structures. There are many examples of unintended consequences of which the future(a) are just a few. Fewer auditing companies: It is suggested that the number of firms that require to audit public companies will diminish resulting in great concentration within the accounting industry. The reason is that Title I requires public accounting firms to register with the PCAOB. There is already differentiate of a decline in numbers; a bm that is expected to continue, not least because of the difficulties in withdrawing once registered (Raiborn and Schorg, 3) bureaucracy: Perhaps the most obvious consequence is the increase in bureaucracy. Arthur... If you want to get a full essay, order it on our website: Orderessay

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