FIN 260 Lecture Notes - Lecture 15: Mike Oxley, Internal Audit, Harry Markopolos
Document Summary
Sarbanes-oxley: july 1st 2002 june 30th 2006: 4 yr. period after sarbanes-oxley, there was a total of 1,121 public recorded traded companies that filed a total of 1,786 false statements. If you have laws and you don"t enforce them, it doesn"t really work. Q: why haven"t they been able to prosecute more people: very time consuming & expensive, not enough evidence, high chance of losing case. Still a huge conflict of interest between auditors & clients (auditors want to keep the client happy): did not require that cpa firms cease all non-audit services, ex: auditors still do consulting for audit clients. This creates a conflict of interest, as the consultants don"t want to lose their business by giving a tough audit. For most accounting firms, consulting is still a huge part of the business. Expensive for companies to implement: government & finance: It is very difficult to regulate financial markets. The gov"t is behind in terms of technology/know how.
