What is the Sarbanes-Oxley Act of 2002 (SOX)? Also, why did it come out?

The Sarbanes Oxley Act of 2002 is also known as the “Public Company Accounting Reform and Investor Protection Act.” Corporate and Auditing Accountability, Responsibility, and Transparency Act.” It was more commonly called Sarbanes-Oxley, Sarbox or Sox.

It is a United States federal law that set new or expanded requirements for all our public company boards, management, and public company boards, management, and public accounting firms.

This act is important because a company that does comply with Sarbanes Oxley encounters serious risks of regulatory intervention, which can end in fees and restrictions. It was passed by Congress to safeguard investors from the possibility of fraudulent accounting activities.

Ii only-reference:sarbanes-oxley act; fasb 133 i is true, as noted in section 802, criminal penalties for altering documents, section 1519: destruction, alteration, or falsification of records in federal investigations or bankruptcy. ii is false. this process is actually covered by the financial accounting standards board, statement 133. sarbanes-oxley act plays no role in establishing accounting mechanisms for derivative or hedging instruments. iii is true, as covered in section 401, disclosures in periodic reports. each annual and quarterly financial report required to be filed with the commission shall disclose all material off-balance sheet transactions, arrangements, obligations iv is true, as noted in section 302, corporate responsibility for financial reports. that the principal executive officer or officers and the principal financial officer or officers, or persons performing similar functions, certify in each annual or quarterly report filed or submitted under either such section. thus, answer c is correct.