Article Assessment: Sox Act of 2002

 Article Review: Sox Action of 2002 Essay

What is the Sarbanes-Oxley Act of 2002 and what is the purpose? The Sarbanes-Oxley Take action of 2002 was designed and passed to shield investors of corporations through the possible functions of deceptive accounting actions by organizations. The SOX Act's purpose is to compliment and force ethical organization practices among businesses throughout all companies. The overall objective was to safeguard financial data that organizations keep to help further force away any and all accounting fraud. Key corporations like ENRON, TYCO, and WORDLCOM had to deal with major issues with reporting improper accounting documents to buyers and the causing consequences of their actions. The scandals brought on by these companies forced the U. S i9000. Congress to implement the SOX Act and enforce rules that could penalize virtually any wrongdoingon the part of the offending company. Many measures had been enforced in the SOX Act of 2002. The SOX Act provides two essential provisions, which pertain to the necessary activities that must be taken by businesses in order to abide by the SOX Act and avoid charges and conceivable jail time. The firs that is Section 302 of the SOX Act which claims that older management sign off of the accuracy and reliability and quality of the accounting records and financial statements. The different key provision is Section 404. Section 404 specifics must set up internal handles and credit reporting methods to also verify the validity of records and still have reports on how adequate these kinds of methods will be. For businesses that have broken the SOX Act tight penalties happen to be in force. A lot of companies might try to eliminate problem of ever existing by permanently destryoing documents to escape being trapped. If a company knowingly falsifies, alters, covers-up, or destroys any litigation related paperwork that firm is susceptible to punishment intended for criminal obstruction and may likely face heavy penalty and jail time under Section 802 of the SOX Act. Section 802 declares the charges for which an organization could encounter for the destruction of documents can...

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