Sox

President Bush signed into law the Sarbanes-Oxley Act On July 30, 2002. The Act dramatically affects all CPAs actively working as an auditor for a publicly traded company.

A new Public Company Accounting Oversight Board will be appointed and overseen by the SEC. The Board, made up of five full-time members, will oversee and investigate the audits and auditors of public companies, and sanction both firms and individuals for violations of laws, regulations and rules.

* Board Composition.Two of the five Board members must be or must have been CPAs. The remaining three must not be and cannot have been CPAs. The Chair may be held by one of the CPA members, but he or she must not have practiced accounting during the five years preceding his/her appointment.

* Funding. The Board will be funded by public companies through mandatory fees. Accounting firms that audit public companies must register with the Board ("registered firm"), and pay registration and annual fees.

* Standard Setting. The Board will issue standards or adopt standards set by other groups or organizations, for audit firm quality controls for the audits of public companies. These standards include: auditing and related attestation, quality control, ethics, independence and "other standards necessary to protect the public interest." The Board has the authority to set and enforce audit and quality control standards for public company audits.

* Investigative and Disciplinary Authority. The Board is empowered to regularly inspect registered accounting firms' operations and will investigate potential violations of securities laws, standards, competency and conduct. Sanctions may be imposed for non-cooperation, violations, or failure to supervise a partner or employee in a registered accounting firm. These include revocation or suspension of an accounting firm's registration, prohibition from auditing public companies, and imposition of