Honors Theses
Date of Award
2005
Document Type
Undergraduate Thesis
Department
Accountancy
First Advisor
Mark Wilder
Relational Format
Dissertation/Thesis
Abstract
The Sarbanes-Oxley Act of 2002 was passed in order to restore investor confidence to the market after a series of accounting fiascos. Congress included in this act legislation creating the Public Company Accounting Oversight Board to monitor audits conducted on publicly traded companies and made many provisions concerning auditor independence. However, the most controversial part of the legislation was Section 404 which requires an audit of internal controls. The intent of this study was to determine how Sarbanes-Oxley will impact the auditing profession. This was determined through an intense review of the most current articles available on the subject. It was determined that the Sarbanes-Oxley Act has changed the way that audits are conducted. Gone are the days when auditors and their clients were on overly fiiendly terms and Arthur Andersen had a floor in Enron’s corporate headquarters. Independence is being stressed to the maximum, and auditors are now more than ever adopting unbiased attitudes of professional skepticism. Section 404 is costing publicly traded companies far more than expected, but some are taking the opportunity to focus on the advantages of assessing the strength of their internal controls. Even so, others see the costs of compliance as far outweighing any benefits. In the course of this study, it was determined that though the costs of compliance with Sarbanes-Oxley are great, a market crash due to corrupt accounting practices would have been devastatmg. Therefore, even though Sarbanes-Oxley compliance is costly and time consuming, it is a welcome alternative to corporate scandals and investor unease.
Recommended Citation
Rayburn, Samantha Marie, "The Impact of the Sarbanes-Oxley Act of 2002 on the Auditing Profession" (2005). Honors Theses. 2099.
https://egrove.olemiss.edu/hon_thesis/2099
Accessibility Status
Searchable text