Definitions for "Sarbanes-Oxley Act"
Keywords:  oxley, sox, scandals, enron, worldcom
Legislation passed largely because of a number of corporate accounting scandals to protect shareholders and the public from accounting errors and fraudulent practices in the enterprise. The act is administered by the SEC, which sets deadlines for compliance and publishes rules on requirements. Sarbanes-Oxley is not a set of business practices and does not specify how a business should store records; rather, it defines which records are to be stored and for how long. The legislation not only affects the financial side of corporations, but also affects the IT departments whose job it is to store a corporation's electronic records. The Sarbanes-Oxley Act states that all business records, including electronic records and electronic messages, must be saved for “not less than five years”. The consequences for non-compliance are fines, imprisonment, or both. IT departments are increasingly faced with the challenge of creating and maintaining a corporate records archive in a cost-effective fashion that satisfies the requirements put forth by the legislation.
Legislation requiring management of publicly-traded companies to report and to augment internal control over financial reporting.
Established the Public Company Accounting Oversight Board and added requirements for publicly traded companies, their officers, boards and auditors. It increased penalties for corporate financial fraud.