Public Policy Analysis Essay Example | Topics and Well Written Essays - 2500 words

Public Policy Analysis - Essay Example This is one of the legislative ways the government of the USA came up with to control the market. In light of this, the paper will venture into the history of the act to try and establish its necessity. It will then create a prescription that will indicate who failed in operation for this law to be enacted. The impact of the law on business and society will be discussed followed by a review of literature as per the course content. The viability of the law will be discussed based on its strengths and weaknesses. History of the Policy and Current Situation The US financial market had witnessed a large series of frauds in the corporate sector in 2002. Some of the highly publicised scandals included some large companies like Enron Corporation, Tyco and WorldCom. Due to these market malpractices, there were serious consequences that saw Enron collapse in 2001 after filing for bankruptcy on December 1. According to Healy and Palepu (2003), the company was a power in the US energy sector ha ving been formed in the year 1985. This large success led the management to into venture production of other energy related products; natural gas, pulp, paper and communications sectors. A critical analysis of the operations of the company according to economic consultants indicated that the rise to stardom of the company was not genuine. Many accounting practices that were unethical had taken place which killed the trust of the public in the US large sector market (PriceWaterhouseCoopers 34). Together with scandals at other companies like WorldCom and Tyco International, the public truly believed that there are several accounting practices yet to be discovered. Due to these happenings where the greedy executives wanted to benefit from their positions in companies, the Sarbanes-Oxley Act of 2002 of 2002 was formed. It is also called Public Company Accounting Reform and Investor Protection Act of 2002 and abbreviated as SOX act of 2002 (Healy and Palepu 15). The SOX bill was signed i nto law on July 30 2002 by the then president George Bush and had provisions creation of reforms in the accounting and corporate business world by use of a board which it mandated, the â€Å"Public Company Accounting Oversight Board." The current position of the act has been a creation of corporate responsibility and it has seen a drastic overhaul of the entire US financial operations where there is a high level responsibility in management. This is a step that has highly reduced bankruptcy among companies. Having not created such an act earlier on means that the government had failed to implement its duties as this act was created as a matter of contingency. Public Prescription and Implementation of the Act As an act that was created as a matter of contingency, the act took care of the matters that were happening at the time and remained to take care of future similar matters. It was an emergency measure that made sure that the confidence of the public in the large business sector was restored. The policy has eleven chapters and each seeks to create accountability to the management teams of the large