Sarbanes Oxley - ,2002 scandals accounting,andauditing...

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Signed into law on July 30, 2002 Response to highly publicized corporate  scandals Provisions affect corporate governance,  accounting, and auditing Purpose is to restore investor confidence
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Enron Material misstatements due to fraud: off-balance sheet financing, abuse of  fair value accounting rules Outcome: $3 billion in required restatements. Largest bankruptcy in history.  Auditor Arthur Andersen convicted (later overturned) of obstruction of justice.  Big 5   Big 4 Key Players: Ken Lay, Jeff Skilling, Andrew Fastow, David B. Duncan Whistleblower: Sherron Watkins WorldCom Material misstatements due to fraud: capitalization of expenses, improper  use of reserves Outcome: First 4 billion then 11 billion in restatements. WorldCom bought out  by Verizon Key Players: Bernard Ebbers, Scot Sullivan, Mike Meyers, Betty Vinson,  Buddy Yates Whistleblower: Cynthia Cooper Other Frauds: Global Crossing, Adelphia, Qwest, Tyco
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Prior to PCAOB the profession was self- regulating. 
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