Final answer:
The statement is true; panels on the nonprofit sector do recommend practices similar to those in the Sarbanes-Oxley Act to enhance governance and financial transparency, despite nonprofits not being legally required to follow these recommendations.
Step-by-step explanation:
The statement that the panel on the nonprofit sector issues reports recommending practices similar to those outlined in the Sarbanes-Oxley Act is True. The Sarbanes-Oxley Act was enacted in response to accounting scandals involving corporations like Enron and WorldCom. Its primary purpose was to enhance corporate governance and strengthen the reliability of financial reporting. Although the Sarbanes-Oxley Act applies to publicly traded companies, the principles of good governance, transparency, and accountability are also critical for nonprofit organizations. To address this, panels on nonprofit sectors often recommend similar practices to those of the Sarbanes-Oxley, though adherence to these practices is generally not mandated by law for nonprofits.