As a result of the infamous Enron and WorldCom scandals, the U.S. reacted with strict guidelines to re-establish confidence in the financial market. Commonly referred to as the Sarbanes-Oxley Act, or “SOX,” the Public Company Accounting Reform and Investor Protection Act of 2002 was implemented to protect shareholders and the general public from fraud and general accounting errors. SOX has come to be considered part of the total fabric driving reliable financial reporting, impacted by securities laws and regulatory oversight, exchange listing requirements, accepted accounting principles, effective auditing standards, accounting firm oversight, effective standards for audit committees of boards, and independence requirements for directors and auditors, among other things.
