Arguments Against Sox

Many of the public companies spoke out against SOX, viewing it as a politically motivated over-correction that would lead to a loss of risk-taking and competitiveness. Others claim that despite congress' noble intentions, the sweeping legislation has been nothing but intrusive, expensive and heavy-handed (Edison, 2006). Because of SOX requirements public companies have to devote considerable resources to make sure they comply with the law. In addition to employees who focus solely on compliance issues, they have to hire a bunch of accountants and lawyers which are expensive to do so. On the other hand, some corporate governance experts have expressed that SOX did some good in providing rigid specificity to accounting rules. The reporting rules