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Effects of Unethical Behavior Article Analysis

Effects of Unethical Behavior Article Analysis Sarbanes Oxley Act was established in 2002, mandating organizations large or small to follow. “The Sarbanes Oxley Act has introduced major changes to the regulation of financial practice and corporate governance” (Sarbanes-Oxley Essential Information, 2012). The act has also changed the way financial statements have to be reported. In a Post Sarbanes Oxley Era companies need to adapt to become more relational to stay successful. The Sarbanes Oxley Act has changed the reporting of financial statements by making organizations include an internal control report. The reason for this report is for the purpose of “showing that not only the company’s financial data is accurate, but that the company has confidence in them because adequate controls are in place to safeguard financial data” (Sarbanes-Oxley Essential Information, 2012). Also at the year-end financial reports need to have an assessment of how effective the internal controls are in which the issuer’s auditing firm attest to the assessment. This happens after the auditing firm reviews the “controls, policies, and procedures during a Section 40/40 audit, which is conducted with a traditional financial audit” (Sarbanes-Oxley Essential Information, 2012). For firms to become more relational in a Post Sarbanes Oxley Era, they need to redefine the roles of each audit professional and retrain their employees to incorporate a relational capacity. Organizations struggle retraining because they see it as difficult and costly, but if applied can significantly improve core relational skills that business deem critical. Business-to-business relations are not what they were before. Because of the Sarbanes Oxley Act, audit firms need to get members of their company to par; from the staffer all the way up to the

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