Question

In response to accounting scandals and the collapse of Enron at the turn of the century, the U.S. Congress passed the Sarbanes-Oxley Act to establish a system of federal oversight of corporate accounting practices. The purpose of the law is to hold CEOs accountable in matters of financial reporting, and to ensure the truthfulness of statements offered to investors. Despite the law's good intentions, businesses must now spend millions of dollars each year just to comply with the regulations. However, the steep challenges of compliance have created a boom in new accounting firms that specialize in helping companies meet the law's requirements.

Congress passed Sarbanes-Oxley into law as a response to:________

a. Executive CEO pay
b. Financial scandals and corporate fraud
c. Consumer protection violations
d. Globalization

Answer 1

Financial scandals and corporate fraud

Step-by-step explanation:

The Sarbanes-Oxley Act was passed in 2002. The purpose of the act was to protect investors from fraudulent financial reporting by corporations.