Sarbanes-Oxley Act and the Insurance IndustryJames M SmithUniversity of PhoenixSarbanes-Oxley Act and the Insurance IndustryThe Sarbanes-Oxley Act was signed into legislation in 2002 and made major changes in the regulation of financial practice and corporate governance. This paper will analyze a specific article while explaining how the Sarbanes-Oxley Act impacts the internal control of the insurance industry. This paper will also discuss auditing around the computer and through the computer, the relevance of each, and how it affects the insurance industry.
The SOX ActThe Sarbanes-Oxley Act (SOX Act) is also referred to as The Corporate and Auditing Accountability, Responsibility, and Transparency Act of 2002. The SOX Act regulates the financial practices and corporate governances so that investors can make informed decisions regarding a company's financials. The SOX Act was implemented after many corporate scandals came to light causing a need for something to be done. Of the things that the SOX Act has changed are "establishing the Public Company Accounting Oversight Board to regulate independent audit firms, restrict the performance of non-audit services by auditors, make public company audit committees responsible for the appointment, compensation, and oversight of any registered public accounting firm employed to perform audit services, require that the principal executive officer and principal financial officer certify periodic financial reports and attest to financial controls, require enhanced financial disclosures, prohibit personal loans by a corporation to its executives and directors, and strengthen criminal and civil penalties for securities fraud" (Korczyk, 2005, p 3).
Michael Oxley , U.S. Senator from Maryland.
Before the signing ceremony of the Sarbanes-Oxley ...
English: MedMal Direct Insurance Company LogoThe insurance industry has its public companies and its nonpublic companies. An example of a public insurance company would be Allstate whereas a nonpublic company would be State Farm Mutual. In an article by the National Association of Mutual Insurance, Sophie Korczyk, PhD wrote that the Sarbanes-Oxley Act does not fit for nonpublic insurance...