Volume 1, Issue 3
August 2007
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Cynthia Fornelli introduces Sarbanes-Oxley panelists
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Sarbanes-Oxley Act Fifth Anniversary
The sponsors of the landmark Sarbanes-Oxley Act (SOX) defended the law and downplayed the need for major changes at an event hosted by the CAQ to mark the Act's fifth anniversary.
The panel discussion at the National Press Club in Washington, D.C., brought together all of the key players in the law's passage and its implementation. Participants at the July 30th event included the bill's authors, former Sen. Paul Sarbanes and former Rep. Michael Oxley; the chairmen of the SEC and PCAOB, Christopher Cox and Mark Olson; former SEC Chairmen Harvey Pitt and William Donaldson, and former PCAOB Chairman William McDonough. The discussion was moderated by Joe Nocera, a financial columnist for The New York Times.
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SOX Survey
In conjunction with the fifth-anniversary event, the CAQ released a survey of 1,000 American investors. The survey demonstrated that while investor confidence in both markets at large and in financial statements has improved dramatically in the years since the passage of Sarbanes-Oxley, there is still more that can be done in that regard. The survey also confirmed that a majority of investors believe SOX was a good idea, and that its provisions have made a difference.
A large majority (84 percent) of investors express confidence in the US capital markets, with 39 percent saying they have quite a bit or a great deal of confidence. In contrast, 65 percent of investors have confidence in the capital markets outside of the US, with only 22 percent indicating quite a bit or a great deal of confidence in those markets.
Eighty percent of investors have confidence in the audited financial information released by publicly traded U.S. companies, while six in ten investors say they have more confidence in audited financial information released by publicly traded U.S. companies than they used to.
When asked specifically about SOX, a majority of investors reported they believe the passage of SOX was a good idea. Five percent said it was a bad idea, and three in ten said it did not make a difference. Most investors do not agree that SOX has created major costs for US businesses that have made them less competitive globally, and therefore should be eased.
The survey and a full summary of the survey results can be found at the CAQ's website.
The Center for Audit Quality has developed this monthly newsletter, designed to keep you up to date each month on ways the organization is addressing the topic of modernizing business reporting and other critical information issues facing investors, issuers, company executives and the public company auditing profession.
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