Title I of SOX, section 101 will be my subject related to nine sections, which established the Public Company Accounting Oversight Board (PCAOB). The Oversight Board provides independent oversight of public accounting firms providing audit services. The Oversight Board also is responsible for registering auditors, defining processes and procedures for compliance audits, inspecting and policing conduct and quality control, and generally enforcing compliance with SOX mandates. Section 101 also conducts inspections of registered public accounting firms; and conduct investigations and disciplinary proceedings. Section 101 also imposes appropriate sanctions on auditors and audit firms where justified.
The PCAOB was put in place due to the failure of accounting self-regulation, and companies not paying attention to the public trust. Enron would be a good example to why the PCAOB was establishes.
The Sarbanes-Oxley Act is been very effective especially by protecting investors and improving the accuracy and reliability of corporate disclosures, and much of the law seeks to further this goal by imposing strict rules for audits and auditors of publicly traded companies, prevent insider trading and deals, requiring companies to adopt strict internal controls, and increasing the penalties for white collar crimes relating to investor fraud. As a matter of fact, the Act effects dramatic change across the corporate area to re-established investor confidence in the integrity of corporate disclosures and financial reporting. Besides, the Act has provided new enforcement tools to contest corporate fraud, punish corporate wrongdoers and prevent fraud with the threat of penalties. The independent financial company who provide service has benefited the most and also the information technology agency, which provide upgrades for corporate due to their legacy systems.