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Corporations Spring 2023

Sarbanes-Oxley Act

Following the collapse of Enron, Worldcom, et al. in 2002, Congress passed the Sarbanes-Oxley Act by an overwhelming and bi-partisan vote, and the bill was signed into law by President Bush.  The act created the Public Company Accounting Oversight Board (PCAOB), which oversees independent auditors of public companies, required disclosure of weaknesses in "controls" mandated in Part III of the FCPA, as well as independent auditor "attestation" to the controls disclosures, and made a number of other less important changes to federal securities law.  Most components of "SOX," as it's called, are now reflected in the Securities and Exchange Act of 1934, which you've already seen, but sometimes it's useful to look at those provisions in the context of SOX as a stand-alone act, which is linked here.