Does sox protect investors by improving the accuracy

Reference no: EM133493675

Case Study: Brigham and Ehrhardt (2022) argue that SOX has changed the structure of corporate compensation packages. Instead of taking stock options as a large part of their compensation package, many managers changed to another format, including cash, which affected the bottom line of many companies. Stock options were a standard part of a company executive's compensation plan. When the executive needed cash, the company would loan them money against the value of their stock, and the executive had to use the cash value of the stock without having to sell it.

Brigham and Ehrhardt (2022) postulated that the SOX Act created new standards for corporate accountability and new penalties for acts of wrongdoing. The Act specifies new financial reporting responsibilities, including adherence to new internal controls and procedures designed to ensure the validity of their financial records. It changes how corporate boards and executives interact with corporate auditors. It removes the defense of "I was not aware of financial issues" from CEOs and CFOs, holding them accountable for the accuracy of financial statements.

Question: Brigham and Ehrhardt (2022) further postulated that the Sarbanes-Oxley Act created a standard for corporate accountability and new penalties for acts of wrongdoing. It changes how corporate boards and executives interact with corporate auditors. It removes the defense of "I was not aware of financial issues" from CEOs and CFOs, holding them accountable for the accuracy of financial statements. The Act specifies new financial reporting responsibilities, including adherence to new internal controls and procedures designed to ensure the validity of their financial records. Does SOX protect investors by improving the accuracy and reliability of corporate disclosures according to securities laws?

Reference no: EM133493675

Questions Cloud

How can teachers help them and how can teachers support : how can teachers help them and how can teachers support people to develop their memories? How can teachers effectively support memory, can compare and contrast

List two management strategies that can use applied : List two management strategies that can use applied to foster public and private partnerships. Provide an example of an existing public/private partnership

Identify a chronic disease and a cancer : What is the economic impact of this cancer in terms of treatment costs and funding allocations

Regarding investigation techniques of law enforcement : What are some of the civil liberty concerns that have been raised regarding investigation techniques of law enforcement?

Does sox protect investors by improving the accuracy : The Act specifies new financial reporting responsibilities, including adherence to new internal controls and procedures designed to ensure the validity

Define and discuss what is meant by the inmate code : Define and discuss what is meant by the inmate code. Finally, define the term prisonization; be sure to discuss how it relates to the larger prison subculture.

What is the public health importance of studying : What is the public health importance of studying the toxicology of lead exposure in pregnant women.

Conducting systematic research about emplovers : Most people search for suitable occupations without taking the time to learn about employers, key contacts, and organizations.

Describe a time in your life where you overcame : Describe a time in your life where you overcame some difficult challenges, what helped you through those hard times and what did you learn from that experience

User Account

All Pages