Sarbanes-Oxley Act: Recognition, Valuation And Influence

Financial supervision and market standardization is a focus attended by financial regulatory authorities of various countries. Sarbanes-Oxley Act is an act famous by its hard and harsh clause. Along the carrying on of the act, there are quite some opposite response and suspicion. Famous Clause 404 has induced huge cost to companies in order to be compliance. Is this act over-controlled? This article analyses both the compliance cost and the social benefit that caused by the Act and get conclusion that the solution is there must exist some kind of balance between government supervision and free market competition. Sarbanes-Oxley Act was kicked off under the US special historical background, like Enron issue etc. The market order was badly damaged and investor's confidence was down to bottom. The harsh Act actually stopped the collapse and regained the confidence from investors and other social parties. In view of current slumping supervision on financial market of China, Sarbanes-Oxley Act is really has certain referring significance.