Q1)Do you think the Sarbanes-Oxley Act will help prevent further fraud? Support your answer.
Yes, Sarbanes-Oxley Act will help prevent further fraud. It is clearly mentioned that an independent auditor can drill down from any piece of information in a financial report, such as sales, profits, etc and track each individual component all the way back to the original transaction, payment and employee who contributed to final totals. In the end the outside auditor will issue separate statements attesting to the company’s general ledger and its control process. By this the company will be secured financially which is the main resource for any company’s success. Though it is mentioned that just a “no confidence” vote from the auditor in case of fraud would land company’s CEO in a deep trouble with $5 million fine and 20 years of imprisonment, why would a company take risk with it’s financial matters.

Q2)Why did it take so long and cost so much for Ingersoll-Rand to become compliant with Sarbanes-Oxley? Do you think will other companies do the same?
For complying with Sarbanes-Oxley Act analysts estimated that companies will spend approximately $1 million for every $1 billion, for Ingersoll-Rand this spending will total $10 million, they also stated that they will spend most of the money on software for financial reporting and transaction processing, also the company had more than 100 internal controls and processes used to create companies financial reports, hence this took so long for Ingersoll-Rand and cost so much to become compliant with Sarbanes-Oxley.
Other companies will also do the same to become compliant with the act which ensures financial security of the company because it is better to invest to become compliant with Sarbanes-Oxley and secure the future of the company.

Name: Arpith U.K
USN: 1MS08IS401