Sarbanes-Oxley Act


A 2002 U.S. federal law which establishes a broad array of standards for public companies, their management boards, and accounting firms. It was passed after a series of accounting scandals at Enron, WorldCom and Tyco International diminished public trust in U.S. corporations, and is designed to increase corporate accountability. The law established the Public Company Accounting Oversight Board (PCAOB), which oversees the auditors of public companies. Sarbanes-Oxley sets forth eleven specific reporting requirements that companies and executive boards must follow, and requires the Securities and Exchange Commission (SEC) to oversee compliance.
also called SOX, Sarbox Sabanes-Oxley, Public Company Accounting Reform and Investor Protection Act of 2002.

Use Sarbanes-Oxley Act in a sentence

Due to all the scandal and corruption at big companies like Enron, the Sarbanes-Oxley Act was created to reduce abuse and corruption with accounting practices.

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The Sarbanes-Oxley Act was created in 2002 after a series of insider trading scandals that now requires corporations to be overseen by the Securities and Exchange Commission (SEC) among other reporting specifications.

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You should read up on the Sarbanes-Oxley Act so that you know what it stands for and see how it can work for you.

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