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http://hdl.handle.net/10397/76086
Title: | Is sOX 404(a) management internal control reporting an effective alternative to SOX 404(b) internal control audits? | Authors: | Fan, YY Li, C Raghunandan, K |
Issue Date: | Aug-2017 | Source: | Auditing, Aug. 2017, v. 36, no. 3, p. 71-89 | Abstract: | Section 404 of the Sarbanes-Oxley Act (SOX; U.S. House of Representatives 2002) continues to be controversial. Using samples of Securities and Exchange Commission (SEC) registrants with market capitalizations of less than $150 million, we find that non-accelerated filers have a significantly larger reduction in the likelihood of material misstatements, discretionary revenues, and discretionary accruals compared to smaller accelerated filers after non-accelerated filers became subject to the requirements of Section 404(a). Our findings are consistent with the argument that management reporting on internal controls (Section 404(a)) may be a cost-effective alternative to internal control audits (Section 404(b)) for smaller U.S. public companies. | Keywords: | SOX 404 Internal control Material misstatement |
Publisher: | American Accounting Association | Journal: | Auditing | ISSN: | 0278-0380 | EISSN: | 1558-7991 | DOI: | 10.2308/ajpt-51669 | Rights: | © 2017 American Accounting Association. All rights reserved. This is the accepted manuscript of the following article: Fan, Y., Li, C., & Raghunandan, K. (2017). Is SOX 404 (a) Management internal control reporting an effective alternative to SOX 404 (b) internal control audits?. Auditing: A Journal of Practice & Theory, 36(3), 71-89, which has been published in final form at https://doi.org/10.2308/ajpt-51669. |
Appears in Collections: | Journal/Magazine Article |
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