How has the Sarbanes-Oxley Act impacted publicly held companies in the United States?

What will be an ideal response?

Sarbanes-Oxley resulted in the creation of the Public Company Accounting Oversight Board to oversee the audits
of public companies. This board sets standards and rules for audit reports. All accounting firms that audit public
companies must register with the oversight board. This board also inspects, investigates, and enforces compliance
by these registered firms. A few of the new governance compliance rules that resulted from Sarbanes-Oxley
include:
1. Auditors must list the nonaudit services they are unable to perform during an audit.
2. Audit-firm employees who leave an accounting firm must wait one year to become an executive for a former
client.
3. Transactions and relationships that are off the balance sheet but that may affect financial status must now be
disclosed.
4. Personal loans from a corporation to its executives are now largely prohibited.
5. Research analysts for securities firms must now file conflict-of-interest disclosures. For instance, analysts must
report whether they hold any securities in a company or have received corporate compensation.
6. Brokers and dealers must disclose if the public company is a client.
7. Altering, destroying, concealing, or falsifying records or documents with the intent to influence a federal
investigation or bankruptcy case is subject to fines and up to twenty years of imprisonment.
Securities laws like Sarbanes-Oxley are complicated and confusing. But failing to follow the Act's new restrictions
and procedures can result in severe penalties.