Goal of the Sarbanes-Oxley Act

Very Easy Corporate Governance Regulatory Environment

The regulatory environment surrounding corporate governance is essential for ensuring accountability and transparency in firms. In the United States, the Sarbanes-Oxley Act (SOX) was enacted following major corporate scandals. This legislation introduced significant reforms in how corporations operate and report their finances.

Which of the following best describes a primary goal of the Sarbanes-Oxley Act?

To reduce the cost of capital for small businesses.

To enhance the accuracy and reliability of corporate disclosures.

To promote mergers and acquisitions in the corporate sector.

Hint

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