Chapter

Internal Controls

Stephen M. Bainbridge

in Corporate Governance after the Financial Crisis

Published in print January 2012 | ISBN: 9780199772421
Published online May 2012 | e-ISBN: 9780199932696 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199772421.003.0006
Internal Controls

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This chapter argues that, in passing the Sarbanes–Oxley Act, Congress was concerned principally with the process by which disclosures are prepared and the information within them is gathered and verified. Thus, much of the Act was concerned with accounting and auditing. While the benefits of these rules are hard to identify, their costs are easy to identify and have proven to be quite high. It is not clear that the game is worth the candle, especially when one considers the possibility that boards may have become so preoccupied with these issues that they failed to devote adequate time to managing the sort of financial risks that came to a head in the crisis of 2007–2008.

Keywords: corporate governance; auditing; accounting; federal law; financial risks; Sarbanes–Oxley Act

Chapter.  16161 words. 

Subjects: Company and Commercial Law

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