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The Sarbanes-Oxley Act (SOX) has affected many audiences within the audit and business sectors. One of the major audiences the act continuously affects is the audit committee of public company board of directors. According to an online resource called the CPA Journal written by Stuart Buchalter and Kristin Yokomoto, since the 1940’s audit committees have been an important and necessary function of public companies financial reporting. In the 1970’s the New York Stock Exchange (NYSE) required board of directors of certain companies to appoint an audit committee. As time progressed more companies were utilizing audit committees and the committees grew in size to include members from NYSE, Nasdaq, and CPA firms. Committees continually practice certain policies and procedures, such as the SOX, in order to ensure high quality financial reporting. The SOX has made a major impact toward audit committees by changing various aspects of their composition, roles and responsibilities, and the liabilities they hold. First, the board of directors directs the composition of an audit committee and assigns a minimum of three members. The Sarbanes-Oxley Act requires that each member be independent, or must not have any relationship with the company that interferes with judgment or must not have worked for the company for the past three years, and at least one member be a financial expert. According to an online resource called the CPA Journal written by Stuart Buchalter and Kristin Yokomoto, financial experts are scarce but some companies provide training and educational seminars so that members possess essential skills in order to be successful at analyzing financial information. The SOX will require companies to disclose the number and names of the audit committee financial experts and if there are none they have to provide a reasoning of why they don’t. The Enron case

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