What is the main purpose of the Sarbanes-Oxley Act of 2002?
A) to increase the accuracy and reliability of corporate disclosures of financial information
B) to ensure that CEOs are adequately compensated for the risks they face in terms of corporate governance
C) to amend NAFTA to be more favorable to U.S. interests
D) to limit the ability of drug companies to engage in direct-to-consumer advertising
E) to limit the ability of the media to obtain confidential corporate information

Question

Quizplus · Accepted Answer

The Sarbanes-Oxley Act of 2002 was enacted in response to a series of high-profile corporate scandals, such as Enron and WorldCom. Its main purpose is to increase the accuracy and reliability of corporate disclosures of financial information, with the goal of enhancing investor confidence and protecting the interests of shareholders. The act established new standards for public companies, their boards, auditors, and other market participants, and created tougher penalties for accounting fraud and other securities violations.

What Is the Main Purpose of the Sarbanes-Oxley Act of 2002