Week 7

Week 7 – Assignment: Assess the Effectiveness of SOX Legislation


Prepare a paper in which you address the following:

· Identify and explain the key ethical components of SOX.

· Explain why financial fraud and abuse still occurs despite the passage of SOX.

· Recommend potential improvements of the SOX legislation based on your research.

· Recommend measures, beyond the scope of SOX, that organizations can implement to prevent financial statement fraud and abuse.

Support your paper with a minimum of five scholarly resources. In addition to these specified resources, other appropriate scholarly resources, including older articles, may be included. Length: 5-7 pages, not including title and reference pages Your paper should demonstrate thoughtful consideration of the ideas and concepts presented in the course by providing new thoughts and insights relating directly to this topic. Your response should reflect scholarly writing and current APA standards.

A Primer on Sarbanes-Oxley

Congress enacted the Sarbanes-Oxley Act of 2002 (SOX) to restore public trust in the markets. Among its ways of achieving this, SOX attempts to improve organizational ethics by defining a code of ethics as including the promotion of honest and ethical conduct, requiring disclosure on the codes that apply to senior financial officers, and offering provisions to encourage whistle blowing.

Despite the passage of SOX, in 2002, it is apparent that financial fraud still occurs.  In fact, according to the Association of Certified Fraud Examiners (ACFE; 2014), organizations often lose a median of 5% of revenue, on an annual basis, due to fraud.  Fraud can influence individuals, organizations, and society.   According to the ACFE (2014), corporate fraud often occurs by individuals who work in accounting, sales, operations, customer service, finance, and more.  Motivation for fraud remains complex, though the implications of these unethical actions are far reaching.


Association of Certified Fraud Examiners. (2014). Report to the nations on occupation fraud and abuse.  Retrieved from http://www.acfe.com/rttn/docs/2014-report-to-nations.pdf

Review the resources listed in the Resources area below to prepare for this week’s assignment(s).