Reference no: EM132491556

Point 1: There are, of course, widely varied opinions of the effectiveness of SOX. Kayla Gillan, a former deputy chief of staff to the Chairman of the SEC, believes that SOX has been a beneficial and successful new law. She believes that, while no legislation can entirely eliminate financial statement fraud, SOX has been effective in rapidly increasing investor confidence. Despite acknowledging that SOX has increased the cost of participating in capital markets, she stated that many believe that the benefits far outweigh the increased costs. She believes that internal controls are more effective, auditor standards are more stringent, auditors are more competent and engaged, and the SEC has become more effective. She believes that the purpose of SOX legislation was to enhance investor protection and that it has largely accomplished this.

Point 2: On the other hand, there are those that believe that SOX has largely been a failure. Billionaire investor Mark Cuban, when considering the SEC and the experiences of startup companies, feels that SOX has made it much more difficult for companies to go public because of the increased costs associated with SOX. There are many more opinions on both sides of this argument. When it comes to preventing and reducing financial statement fraud, what do you think? Has SOX been a help or a hindrance?

In summary, for this discussion (per the guidelines above):

Question 1: Write a 1-2 paragraph summary of a pre-SOX case study of financial statement fraud

Question 2: Write a brief evaluation of how you think SOX might have impacted and/or changed your case study

Question 3: Discuss whether SOX has been successful in reducing financial statement fraud.

Question 4: Post at least two substantive responses to other student posts

Attachment:- SoX.zip