SOX (Sarbanes-Oxley)

The Sarbanes-Oxley Act (SOX), enacted in 2002, is a U.S. law designed to improve the accuracy and reliability of corporate financial reporting. It was created in response to financial scandals like Enron to protect investors and ensure transparency. SOX sets strict rules for companies’ financial practices, requiring internal controls, accurate record-keeping, and independent audits. It holds executives accountable for financial reports and imposes penalties for misconduct. Overall, SOX aims to strengthen public trust in the financial markets by promoting honesty and reducing fraud.