This will help prevent any fraudulent information being used on a financial statement. One of the ways that companies tried to get around this act was to have their accounting firm certify the books; however, this was made illegal as well so that a third party comes in and certifies the books. Another conflict of interest that was shown when this act came into place was the relationship between a companys CEO and CFO with the auditors of the company the person who audits a company does not report to their firm they report to a board of directors for the company.
Having this act in place not only arises so many areas of conflict that a supervisor can only supervise a certain client for five years in an auditing company. This means after five years of a customer they need to be moved. Hooper C. (2010 July 9). This act to certify that a companys CEO and CFO are putting their names and freedom on the line stating that they companys financial statements are true.
There is a tremendous amount conflict of interest that occurs with this act not only between external users but internal users as well. The Sarbanes-Oxley Act of 2002 was created to help and fraudulent information being put on or in a companys financial statements. This protects the public from making falsified investments in companies as well as the government to make sure they get the money they are required to receive from taxes. This act overall protect companies, people, and the government financially. Hooper C. (2010 July 9).