Define each of the following terms:
a. Sarbanes-Oxley Act
b. Proprietorship; partnership; corporation
c. S corporation; limited liability company (LLC); limited liability partnership (LLP)
d. Intrinsic value; market price
e. Marginal investor; equilibrium
f. Corporate governance
g. Corporate raider; hostile takeover
h. Stockholder wealth maximization i. Business ethics
Congress felt there was a need for additional investor protections against inaccurate information from companies.
In 2002, Congress passed this act to protect shareholders, employees and the public from accounting errors and fraudulent financial practices. There were 3 key provisions:
The Sarbanes-Oxley act, passed by Congress in 2002, is intended to improve the accuracy of information which is made public by both board members and shareholders of public companies.