What is Sarbanes Oxley Act?

The Sarbanes Oxley Act of 2002, sometimes referred to as SOX, was a legislative attempt to respond to the accounting scandal caused by the recent fall of some publicly held companies and the perceived excesses of the management of some other companies. Sarbanes Oxley requires compliance with a comprehensive reform of basic corporate accounting procedures. The aim is to promote and improve public confidence in the quality and transparency of financial reporting. The reforms apply to both internal and external auditors. Software for compliance is available in several useful forms.