Sarbanes Oxley

Running head : SARBANES OXLEY ACT

Sarbanes Oxley Act

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Sarbanes Oxley Act

Sarbanes Oxley Act of 2002 resulted from complains about various accounting and cooperate scandals that hit United States prior to this year and which caused investors to lose billions of shillings in cases where the affected companies ' share price collapsed . Such companies included Enron , WorldCom , Tyco International among others . These scandals made the public to loss its interest in the country 's security markets a thing that threatened a decline

in the number of business activities in these markets or in the overall investment in general

The Act established new enhanced standards in respect to all public companies inclusive of public accounting firms in United States . It was aimed at establishing new standards for public companies boards and management . In particular , the Act contains eleven titles in stipulates additional board responsibilities in regard to criminal penalties . It also put Security and Exchange Commission (SEC ) under the obligation of implementing rulings in the context of complying with the new laws . It has been argued that the Act has contributed much to the restoration of public confidence in the country 's capital markets through the strengthening of corporate accounting controls among other things (Roy , 2006 ,

. 98

On the other hand , some have argued that it has reduced the country 's international competitive edge as compared to foreign providers of financial services . In this context , it has been argued that what SOX has introduced...