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Sarbanes-Oxley Act Fraud Case Study

794 Words4 Pages

The Sarbanes-Oxley Act of 2002, passed due to series of failures designed to help protect the interest of the investors. The SOX Act created a total revision of regulations for public accounting and professional auditing. The SOX Act is considered to be the most useful legislation affecting public corporations and independent audits in the late 1930’s. Despite the Sarbanes-Oxley Act fraud and abuse still may exist in the corporate world. Since the SOX Act, corporations have used significant resources to access and improvement their internal and external audits, and they are a better position to deter fraud before it happens. However, there is little evidence that proves that fraud has been reduced. Anti-fraud may have decease since the …show more content…

“ An organization’s financial statements are the end product of the accounting cycle and provide a representation of a company’s financial position and periodic performance. The accounting cycle includes the procedures for analyzing, recording, classifying, summarizing, and reporting the transactions of a business or organization” (Albrecht, Holland, Malaqueno, Dolan & Tzafrir, 2015). Moreover, the client—firms relationship can harm the result to their investors when financial misconduct makes it difficult to support confidential claims when it comes to …show more content…

The Sarbanes-Oxley Act has affected all mandatory reporting organizations both foreign and domestic. “ A concern with using the SOX as an instrument is that it was enacted during a single year and it is, therefore, possible that firm policies and values were influenced by other events at the time”(Banerjee, 2015). The SOX Act also affects the individuals who play a role in ensuring the integrity such as accounting firms, attorneys, and research firms. The following are recommendations that I have made to potentially improve the Sarbanes-Oxley Act. • Restoring Confidence in the Accounting Firms • Enforcing the Securities Laws • Improving the integrity of the financial reporting process for top-management • Improving the Performance • Improving Financial Reporting and

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