Sarbanes-Oxley Act of 2002

The Sarbanes-Oxley Act of 2002 (SOA) authorizes a multitude of new government and quasi-government regulatory activities designed to protect investors by improving the accuracy and reliability of corporate disclosures. Since its passage into law on 7/30/02, literally thousands of references, comments, and discussions have been posted to the Internet. This seemingly incessant posting will probably continue for quite some time or at least until such time as the law is fully implemented. Links which are accurate and timely today may well be inaccurate and untimely tomorrow. With that caveat in mind, here are some informative sites as of mid-December, 2002.

Accountancy Age, a UK periodical, discusses the proposed move to principle-based accounting from the existing rules-based accounting that the United States presently uses.

The American Institute of Certified Public Accountants has also put together a one-stop-shopping site. It includes an historical perspective (Enron and Worldcom) and then moves on to background documents, regulatory activities, and PCAOB activities. This is another well organized, user friendly site.,5309,7951,00.html?f=relatedore,5309,7951,00.html?f=relatedore

A more comprehensive article on the move to principle-based accounting from The Economist Group, the publishers of the Economist.
(Both of these UK publications provide access to current news stories in the UK on SOA.)

As a direct result of SOA, the Financial Accounting Standards Board has issued a proposal for the use of principle-based accounting to set the accounting standards used in the United States.

Title I of SOA provides for the creation of the Public Company Accounting Oversight Board(PCAOB) to oversee the audits of public companies that are subject to securities laws. See Washington DC attorney Erika C. Bird’s article discussing the potential problem in this creation in , “Is the Public Company Accounting Oversight Board Constitutional?”

This is a one-stop-shopping site developed by Karl Nagel, a California-licensed CPA. The site monitors any rules and regulations proposed and/or issued by the SEC to implement the Sarbanes-Oxley Act. The rules and regulations are neatly summarized and links are provided to the appropriate full text. The site also provides coverage of current news stories about the Act. This is really a well organized site that is updated daily and is user friendly.

Another result of SOA is the SEC’s proposed rule on the implementation of standards of professional conduct for attorneys. This substantial document with its final date for comments of 12/18/02 is guaranteed to interest any attorney who does any kind of securities work.

Compiled by Joanne Blinn of Nutter, McClennen & Fish in 12/02.

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