Problem
When the Sarbanes-Oxley Act was enacted on July 30, 2002, it profoundly changed the regulatory environment for publicly traded companies in the United States. The law was passed in reaction to the accounting scandal at Enron Corp. which forced the firm to file bankruptcy in December 2001 and which led to the obstruction of justice conviction and subsequent demise of accounting firm Arthur Andersen. Known as SOX, the act consists of 11 sections covering topics such as corporate governance, financial reporting, civil and criminal liability, and regulatory structure (Moran, 2013).
The Sarbanes-Oxley Act is arranged into eleven titles. As far as compliance is concerned, the most important sections within these are often considered to be 302, 401, 404, 409, 802 and 906.
Choose one of the 11 titles in the Sarbanes-Oxley Act of 2002 and describe it. Do you believe this section is an effective deterrent to an accounting scandal? Why or why not?