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Sarbanes-Oxley Act of 2002- WebQuest | Facts | Issues | Authorities | Conclusion | Home | The history of the Industrial Age is littered with "financial crises" that prompted political activity to prevent a recurrence of a given crisis. In 1933 and 1934, the U.S. Congress passed the securities acts in response to the 1929 stock market crash. Those acts granted the "audit franchise" to the self-regulating public accounting profession. Consequently, the financial crises occurring since that time frequently have been referred to as "audit crises" because they occurred when the audit process failed. Enron provides one recent example of a massive failure that had disastrous consequences for the company's employees, owners, and audit firm, as well as the U.S. economy. It was also the primary force behind new federal legislation designed to strengthen the reliability of the audit process, the Sarbanes-Oxley Act of 2002. Go to the Issues Page. |
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