sarbanes oxley master file

2.  Auditor’s rotation
 Public Company Accounting Oversight Board
(PCAOB) and Non-Audit services
 Conflict of Interests &Hiring Auditors
 Executive Accountability& retention of papers
 Positives/Difficulties about Sarbanes Oxley,
Changes
 Internal Controls?

3.  - Acct Scandals: Enron, Worldcom
 - Worldcom misrepresented 9 Billion dollars on
Income Statement
 - Worldcom Stock plummeted; loss of 30,000
jobs
 - Impetus for tougher bill that became Sarbanes-
Oxley

4.  Rotate auditor or lead partner at least every
five years
 Positive effects:
1) Enhance auditors’ independence
auditors develop familiarity with the client and
can lose their independence

 2) Improve audit quality
Negative effects:
1) costly
 2) Break up some business relationships

5.  Falls under the SEC
 Nonprofit organization in charge of
overseeing audits of public companies
 Auditors of public companies subject to
external and independent oversight
 Consists of a board of five members

6.  Accounting firms must register with PCAOB in
order to prepare, issue, or participate in
audits
 Non US accounting firms involved in audits of
public US companies must also register.
 Has the power to investigate, can set court
hearings and hand out sanctions

7.  Rules in place by Sarbanes Oxley to establish
auditor independence
 These rules restrict, but do not eliminate
 Apply only to the audit of public companies

8.  Broker, dealer, investment adviser, or
investment banker services
 Legal and expert services unrelated to audit
 CPA cannot sell services to client other than
audit, review, or attest services
 Can provide tax services, as long as not for
company execs in charge of financial
reporting or tax avoidance planning services

9.  Bookkeeping and other accounting services
 Financial information systems design and
implementation
 Appraisal or valuation services
 Actuarial services
 Internal audit outsourcing
 Management or HR functions

10.  Conflict of Interest- It shall be unlawful for a registered public accounting firm
 to perform for an issuer any audit service required by this title,if a chief executive
 officer, controller, chief financial officer, chief accounting officer, or any person

 serving in a equivalent position for the issuer, was employed by that registered
 independent public accounting firm and participated in any capacity in the audit
 of that issuer during the 1-year period preceding the date of the initiation of
 the audit.

11.  Section 301 addresses the areas of audit
committee responsibility:
• Relationship to auditors
• Audit committee independence
• Procedures to address complaints regarding
accounting, internal accounting
 controls, or auditing matters
• Authority and funding to hire advisers

12.  TITLE III—CORPORATE RESPONSIBILITY
 • The signing officers have reviewed the report
• The report does not contain any material untrue statements or
material omission or be considered misleading
• The financial statements and related information fairly present
the financial condition and the results in all material respects
• The signing officers are responsible for internal controls and
have evaluated these internal controls within the previous ninety
days and have reported on their findings
• A list of all deficiencies in the internal controls and information
on any fraud that involves employees who are involved with
internal activities
• Any significant changes in internal controls or related factors
that could have a negative impact on the internal controls

13.  Executive Accountability, retention of papers
 www.sec.gov
 www.investeorwords.com
 www.sarbanes.oxley-101.com/sox
 www.soxlaw.com
 www.about.com/politicalhumor
 Bisoux,T; July/Aug 2005. The Sarbanes-
Oxley. Biz Ed
 Quick, B, Aug 22, 2012. Mike Oxley on
Sarbox: His One Big Regret. Fortune Magazine

14. Introduction:
 Beresford, Dennis, Nicholas Katzenbach, and C. B. Rogers, Jr.
"Report of Investigation." Report of Investigation. U.S. Securities
and Exchange Commission, 31 Mar. 2003. Web. 25 Aug. 2012.
<http://www.sec.gov/Archives/edgar/data/723527/000093176
303001862/dex991.htm>.
 Bumiller, Elisabeth. "CORPORATE CONDUCT: THE PRESIDENT;
Bush Signs Bill Aimed at Fraud In Corporations." The New York
Times. The New York Times, 31 July 2002. Web. 25 Aug. 2012.
<http://www.nytimes.com/2002/07/31/business/corporate-
conduct-the-president-bush-signs-bill-aimed-at-fraud-in-
corporations.html?pagewanted=all>.
 Moberg, Dennis, and Edward Romar. "WorldCom." WorldCom.
Santa Clara University, 2002. Web. 25 Aug. 2012.
<http://www.scu.edu/ethics/dialogue/candc/cases/worldcom.ht
ml>.
 Romar, Edward, and Martin Calkins. "WorldCom Case Study
Update 2006." WorldCom Case Study Update 2006. Santa Clara
University, 2006. Web. 25 Aug. 2012.
<http://www.scu.edu/ethics/dialogue/candc/cases/worldcom-
update.html>.

15.  Public Company Accounting Oversight Board.
2012. PCAOB. August 25 2012. Web.
 Arens, Alvin A, Randal J. Elder, Mark S.
Beasley. Auditing and Assurance Services:
An Integrated Approach. Upper Saddle
River: Pearson Education, 2012. Text.