Sarbanes Oxley and its Influence on the Finance and Information Coursework

Sarbanes Oxley and its Influence on the Finance and Information Technology - Coursework Example One reason for its significance is its scope along with the material shift it signifies in the balance of federal and state regulation of corporations. Historically, substantive regulation of corporate procedure and governance has been primarily the province of state regulation, while the federal securities laws have regulated disclosure. (Klimko, May 2004) The second reason is that SOX seeks to improve investor confidence by tightening government regulation of the accounting, reporting, and corporate governance practices of public companies. Many of the Act's provisions require the SEC to adopt implementing rules, and many rules have been adopted since the Act became law. (Klimko, May 2004) In this respect, positive changes are recorded in corporate auditing controls and compliance procedures. The Act also established the Public Company Accounting Oversight Board to regulate accounting firms who perform audits on the financial statements of publicly held companies. The board's mission is clear: to tighten accounting standards and restore confidence in the profession. Subject to direct SEC supervision, this body also is responsible for disciplinary action--everything from investigation to significant fines--against any company found in noncompliance with the Act. (Longnecker, 2004)As is generally the case with governmental intervention in the affairs of business, Sarbanes-Oxley has triggered many unintended side effects. Most experts agree that it has changed several facets of business, including the concept of the executive seat; the way honest, hard-working CEOs interpret their roles; and the methods scandal-weary boards use to operate and make decisions moving forward. (Longnecker, 2004) Further, the uncertainty surrounding the legislation's impact on auditing, financial reporting, executive loans, etc. has had a chilling effect on operations in boardrooms across the U.S. Leading decision makers at companies are, in many cases, so intently focused on legislative issues that they have been distracted from fully focusing efforts on their business' primary operations and creating shareholder value. Additionally, it is not just the CEO and CFO who are being asked to certify financial records and take on additional risks and responsibilities. Although not specifically mandated by Sarbanes-Oxley, many companies are r equiring certifications of financial results by their division presidents, department heads, and other senior management in an effort to comply with corporate governance and controls. As the process continues to filter down through the ranks, simply conforming with these laws could end up costing shareholders more than they ever thought possible. In essence, the ripple effect of Sarbanes-Oxley very easily could take businesses from a place of under regulation to one of overregulation, which can be just as dangerous for a variety of reasons.

International Business Economics Essay Example | Topics and Well Written Essays - 250 words

International Business Economics - Essay Example ts as neighboring countries overlooked there selfish restrictions and focused on a rather mutual beneficial ground in exchange of resources (Zhang, 2012). Furthermore, regional economic integration draws its attention from global economic integration in that they both envision and harvest same benefits. They establish free trade areas where member countries engage in free exchange of resources between themselves. This promotes trade as goods within bloc regions are available and affordable. On the other hand, the member countries are independed to formulate trade policies with non member countries. Long term benefits of free trade areas are creation of customs union and establishment of a common market (Zhang, 2011). A recent study reveals that regional economic integration has significantly improved economic status of developing countries. This is evident as removal of economic restrictions has not only expanded job opportunities within member countries due to free movement and exchange of labor but also created a flat ground where a common understanding between member countries has been established to promote political consensus. According to Zhang (2011) regional economic integration has its advantages, just as it promotes trade; it leads to trade diversions as member countries trade more with each other than non member countries. In essence it means that trading will go on despite if the partner is expensive or inefficient just because they belong to the same economic bloc. It has resulted in creation of trade barriers between member states and non member states. Moreover, production process can shift to member countries with cheap labor and workers may migrate to gain access to good employment opportunities. These sudden shifts can result in increased taxation of resources of member countries. Lastly with continuous discussions and agreements within the flat ground countries may feel that they are giving up more of their economic and political right just