Sarbarnes-Oxley Act (SOX)

The Sarbanes-Oxley Act of 2002 (SOX) is a U.S. audit regulation covering financial reporting rules. It was implemented to guard against financial misconduct in response to large-scale financial scandals in the early 2000s. SOX created the Public Company Accounting Oversight Board to ensure that all auditing of public companies is subject to external and independent review. SOX also mandates that corporate executives personally certify the accuracy of financial statements. Fraudulent activity could otherwise result in imprisonment for convicted individuals. Under SOX, corporate whistleblowers are also protected.

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