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Is it time to change SOX?

Is it time to change SOX?. Solongo Batbaatar MA0N0228. Sarbanes-Oxley Act of 2002. Purpose of the law. Prevent corporate accounting fraud & financial scandals Protect investors. Section 404.

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Is it time to change SOX?

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  1. Is it time to change SOX? SolongoBatbaatar MA0N0228

  2. Sarbanes-Oxley Act of 2002

  3. Purpose of the law • Prevent corporate accounting fraud & financial scandals • Protect investors

  4. Section 404 • It requires companies to have internal & external financial check. First review their own systems for ensuring accurate financial reports and then have them tested by outside auditors.

  5. Problems of complying the Act • IT system • Hire extra employees

  6. Henry PaulsonUS Treasury Secretary • He said, section 404 should be implemented in a more efficient and cost effective manner.

  7. Christopher CoxChairman of Security & Exchange Commission (SEC) - Rule should be adapted to companies based on company size.

  8. Supporters of SOX • Law and related reforms have produced more reliable corporate financial statements, which investors rely on when deciding whether to buy or sell shares.

  9. Duncan W. RichardsonChief equity investment officer • Even the act is much-disparaged requirements for testing internal financial controls could drive gains in corporate productivity and profits.

  10. SOX impact on Market Efficiency • In 2002, the market value of the Wilshire 5000 for all public companies in US, stood at $10.5 trillion. • By April 2007, the value of the Wilshire 5000 was 14.5 trillion

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