Sarbanes-Oxley Act (SOX)
What is Sarbanes-Oxley Act (SOX)?
The Sarbanes-Oxley Act is a U.S. federal law that established sweeping auditing and financial regulations for public companies. It was enacted to protect shareholders and the general public from accounting errors and fraudulent practices in enterprises.
Why It Matters
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It mandates strict internal controls and reporting procedures for financial data.
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It holds corporate executives personally responsible for the accuracy of financial statements.
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It increases the independence of outside auditors who review corporate books.
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It provides protections for whistleblowers who report internal financial misconduct.
