Discussion Question 2 Week 10 - Short- and Long- Run Impact - Assignment Example

Short and Long Run Impact al Affiliation Short and Long Run Impact Evaluate the overall effectiveness of the Sarbanes-Oxley Act todate, and determine who has benefitted most from the passage of the act. Provide two specific examples to support your response. The overall effectiveness of the Sarbanes-Oxley Act was realized only years after its reported implementation date in 2002. What was initially thought of as tedious and extremely challenging, turned out to be effective in deterring fraud and in ensuring compliance to accounting standards, transparency and governance.

According to Wagner & Dittmar (2006), the SOA has “benefitted firms’ governance, management, and investors” (p. 1) through enabling the improvement of the following endeavors: “standardize and consolidate key financial processes (often in shared service centers); eliminate redundant information systems and unify multiple platforms; minimize inconsistencies in data definitions; automate manual processes; reduce the number of handoffs; better integrate far-flung offices and acquisitions; bring new employees up to speed faster; broaden responsibility for controls; and eliminate unnecessary controls” (Wagner & Dittmar, 2006, p. 1).2.

From the e-Activity above, analyze how easy or difficult it may be for officers and managers of organizations to stay in strict compliance with SEC rules and for consumers, investors, and regulators to detect errors. Then, determine at least one action that CEOs and boards can take to improve compliance. The 10Q of a company are actually defined as “a comprehensive report of a companys performance that must be submitted quarterly by all public companies to the Securities and Exchange Commission.

In the 10-Q, firms are required to disclose relevant information regarding their financial position. The form must be submitted on time, and the information should be available to all interested parties” (Investopedia US, 2013, p. 1). The 10Q was likewise noted to be filed within 35 days after of the first three quarters. Therefore, it is tedious for officers and managers to stay in strict compliance due to the regularity and comprehensiveness of the information which should be disclosed and to be likewise disseminated to relevant stakeholders: consumers, investors, and regulators.

Therefore, to improve compliance, since there is a standard format to the followed, accounting and finance personnel must regularly update their financial reports (which is actually done in the company’s books daily, weekly and monthly). As such, consolidating the figures on the required quarterly basis would be easier. For instance, a look at the 10Q of Amazon.com contains financial information and other information contained in 47 pages (Amazon.com, 2013). Thus, the wealth of information which should be added on a regular basis adds to the challenge of complying, as required.

ReferencesAmazon.com. (2013). Quarterly Results. Retrieved from corporate-ir.net: http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-reportsotherInvestopedia US. (2013). Definition of SEC Form 10-Q. Retrieved from investopedia.com: http://www.investopedia.com/terms/1/10q.aspWagner, S., & Dittmar, L. (2006). The Unexpected Benefits of Sarbanes-Oxley. Retrieved from Harvard Business Review: http://hbr.org/2006/04/the-unexpected-benefits-of-sarbanes-oxley/ar/1