Prior to the Sarbanes - Oxley Act of 2 0 0 2 ( SOX )
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Question:
Prior to the SarbanesOxley Act of SOX auditing companies had engaged in nonauditing functions with the corporations they audited. Although this had been cause for concern by the SEC, rules were not promulgated until mandated by SarbanesOxley. Now, auditing companies are forbidden to perform nonauditing services simultaneously with auditing services. Auditing companies must now contract with the audit committee of the corporation they propose to audit, rather than with the management of the corporation, as had been the practice before. SOX also made the audit committee directly responsible for the appointment, compensation, and oversight of any work done by the auditors. Do you think this will change the nature of how an audit is done? Do you think it will prevent the auditors from engaging in practices that could undermine the intent of SOX? Do you think the added layer of requiring the CEO and CFO to certify the work of the auditing committee helps to bring back the balance that was lost by commingling accounting practices and auditing practices?
Related Book For
Principles of Auditing and Other Assurance Services
ISBN: 978-0078025617
19th edition
Authors: Ray Whittington, Kurt Pany
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