The Sarbanes Oxley Act Of 2002 Essay

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The Public Company Accounting Oversight Board, or PCAOB, is a nonprofit organization established by the government to oversee audits of public companies. The organization also oversees the audits of broker-dealers, including compliance reports filed pursuant to federal security laws (Public Company Accounting Oversight Board, n.d.). The PCAOB was created by the Sarbanes-Oxley Act of 2002, also known as SOX, to protect investors and the public interests by promoting accurate audits through independent auditors (Public Company Accounting Oversight Board, n.d.). SOX was established by the government after many companies were caught committing fraudulent activity including Enron and WorldCom. PCAOB is only one part of the Sarbanes-Oxley Act hoping to deter fraud and protect investors and the economy through inspections and investigations of accounting firms throughout the world.
Duties of PCAOB:

The specific duties of the PCAOB are outlined in the Sarbanes-Oxley Act of 2002. The PCAOB is responsible for registering public accounting firms that prepare audit reports in accordance with section 102 of SOX (Sarbanes-Oxley Act of 2002, 2002). There are hundreds of auditing firms registered with PCAOB in the United States and thousands across the world. The top four auditing firms are PWC, KPMG, Ernst & Young, and Deloitte whom audit over 80% of public American companies. These companies are known as “The Big 4 Accounting Firms”. Even though these companies are separate,…

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