On a muggy July day five years ago, President George W. Bush put his pen to the Sarbanes-Oxley Act, an expansive piece of corporate reform legislation designed to help restore investor confidence in a nation scarred by an apparently unending series of accounting scandals.The 11-section measure, which essentially changed the way public companies do business, ushered in a cascade of new reforms, service prohibitions and standards for public issuers, their boards and the CPA firms that audit them. It was the most deliberately invasive regulatory reform passed since the Roosevelt administration, touching nearly every aspect of the financial reporting process.
SOX was a hybrid of the Corporate and Auditing Accountability Responsibility and Transparency Act, or CAARTA, sponsored by Rep. Michael Oxley, R-Ohio, and Senate Bill 2673, authored by Senate Banking Committee Chairman Paul Sarbanes, D-Md.
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