Video: Goals of SOX 2002

In this lesson, Nick Palazzolo, CPA, discusses the goals of the Sarbanes-Oxley Act (SOX) of 2002, which aims to improve investor confidence by facilitating greater transparency in internal controls. He emphasizes the importance of understanding the competency of the audit committee and compliance of senior officers through a code of conduct. Nick also clears potential misconceptions by highlighting that SOX does not focus on profitability or the growth of a company, but rather on proper financial reporting and risk management.

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Video Transcript

Instructor: Nick Palazzolo

Nick Palazzolo is head instructor of ExamPrep.ai CPA Review. Nick's teaching style is engaging & upbeat, combining practical Big 4 tax & assurance expertise with years of 1-on-1 coaching. His lessons are concise and emphasize what you need to know to pass. Whether you're a recent grad or working full-time, we’re confident you can conquer your CPA exams with Nick’s review.

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Powering through here, having a good time with Sarbanes-Oxley. What are the goals of this regulation? Well, just to make everything better, right? It exists to improve investor confidence, and it does this by facilitating greater transparency with the adequacy of the internal controls. Just make sure you're familiar with these points. The competency of the audit committee and compliance of senior officers through a code of conduct. Now, some important points to make note of, because questions could try to trip you up. Stocks does not constrain itself with profitability of a company. That is up to the company and there are other items and other organizations involving profitability, but stocks is more about proper financial reporting, balancing risk and growth of the entity, right? That's up to the entity to do that. It's not stocks' job to do that. And then anything else besides what we discussed here, these are the items that stocks exists to improve. Not these, not anything else.

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Ethics & Independence

Module: 3 Concepts, 42 Videos

AICPA Code of Professional Conduct Overview

1:04

AICPA Code of Professional Conduct Objectives

2:42

Introduction to AICPA Code of Professional Conduct

1:55

AICPA Requirements of Independent Auditors