Assignment 1: Impact of the Sarbanes-Oxley Act (SOX) (Solved)

accounting

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Assignment 1: Impact of the Sarbanes-Oxley Act (SOX)



Due Week 3 and worth 280 points

Assume that you are a CEO of a medium-sized company that needs a significant influx of cash for several expansion projects. As the CEO, you must determine whether your company should remain private or go public. Some companies postpone going public due to the unpredictability of economic and market conditions. Consider the ramifications of both alternatives. Construct an argument for and against going public. Before providing your response, review the guidelines and regulations associated with going public by visiting Small Business and the SEC located at http://www.sec.gov/info/smallbus/qasbsec.htm.

Use the Internet to research SOX law, located at http://www.sarbanes-oxley-101.com/sarbanes-oxley-compliance.htm.

Write a four to five (4-5) page paper in which you:

1.       Outline three (3) ways in which your medium-sized private company may benefit from going public, providing a rationale for each.

2.       Create an argument that the same goals may be achieved if the company remains a privately held entity. Provide support for your argument.

3.       When a company decides to go public, it can typically obtain capital by issuing stocks or bonds. Suggest four (4) leading financial ratios that will be evaluated and how each will impact the company’s decision to obtain expansion funds. Determine whether the results of the ratios would alter the decision to go public. 

4.       By researching the results of SOX compliance surveys, assess the financial impact that SOX might have on your company if it decides to go public. Considering the impact of SOX compliance, take a position as to whether your company can overcome the challenges posed by SOX compliance if the decision is to go public. Based on your research, support your decision by identifying the potential advantages and disadvantages that SOX may have on your company. Provide specific examples.

5.       Make a recommendation as the CEO regarding the alternative (i.e., going public or staying private) that will best support the company’s expansion goals. Support your position.

6.       Use at least four (4) quality academic resources in this assignment. Note: Wikipedia and other Websites do not qualify as academic resources.

Your assignment must follow these formatting requirements:

·         Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.

·         Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.

The specific course learning outcomes associated with this assignment are:

·         Analyze financial reports, prepare analysis, and draw conclusions based on the financial analysis.

·         Calculate and interpret various financial and operating ratios used in business.

·         Use technology and information resources to research issues in accounting management.

·         Write clearly and concisely about accounting management using proper writing mechanics.

 

Grading for this assignment will be based on answer quality, logic / organization of the paper, and language and writing skills, using the following rubric.

Points: 280

Assignment 1: Impact of the Sarbanes-Oxley Act (SOX)

Criteria

Unacceptable

Below 70% F

Fair

70-79% C

Proficient

80-89% B

Exemplary

90-100% A

1. Outline three (3) ways in which your medium-sized private company may benefit from going public, providing a rationale for each.

Weight: 15%

Did not submit or incompletely outlined three (3) ways in which your medium-sized private company may benefit from going public; did not submit or incompletely provided a rationale for each.

Partially outlined three (3) ways in which your medium-sized private company may benefit from going public; partially provided a rationale for each.

Satisfactorily outlined three (3) ways in which your medium-sized private company may benefit from going public; satisfactorily provided a rationale for each.

Thoroughly outlined three (3) ways in which your medium-sized private company may benefit from going public; thoroughly provided a rationale for each.

2. Create an argument that the same goals may be achieved if the company remains a privately held entity. Provide support for your argument.
Weight: 15%

Did not submit or incompletely created an argument that the same goals may be achieved if the company remains a privately held entity. Did not submit or incompletely provided support for your argument.

Partially created an argument that the same goals may be achieved if the company remains a privately held entity. Partially provided support for your argument.

Satisfactorily created an argument that the same goals may be achieved if the company remains a privately held entity. Satisfactorily provided support for your argument.

Thoroughly created an argument that the same goals may be achieved if the company remains a privately held entity. Thoroughly provided support for your argument.

3. Suggest four (4) leading financial ratios that will be evaluated and how each will impact the company’s decision to obtain expansion funds. Determine whether the results of the ratios would alter the decision to go public.

Weight: 15%

Did not submit or incompletely suggested four (4) leading financial ratios that will be evaluated and how each will impact the company’s decision to obtain expansion funds. Did not submit or incompletely determined whether the results of the ratios would alter the decision to go public.

Partially suggested four (4) leading financial ratios that will be evaluated and how each will impact the company’s decision to obtain expansion funds. Partially determined whether the results of the ratios would alter the decision to go public.

Satisfactorily suggested four (4) leading financial ratios that will be evaluated and how each will impact the company’s decision to obtain expansion funds. Satisfactorily determined whether the results of the ratios would alter the decision to go public.

Thoroughly suggested four (4) leading financial ratios that will be evaluated and how each will impact the company’s decision to obtain expansion funds. Thoroughly determined whether the results of the ratios would alter the decision to go public.

4. By researching the results of SOX compliance surveys, assess the financial impact that SOX might have on your company if it decides to go public. Considering the impact of SOX compliance, take a position as to whether your company can overcome the challenges posed by SOX compliance if the decision is to go public. Based on your research, support your decision by identifying the potential advantages and disadvantages that SOX may have on your company. Provide specific examples.

Weight: 20%

Did not submit or incompletely assessed the financial impact that SOX might have on your company if it decides to go public, by researching the results of SOX compliance surveys. Did not submit or incompletely took a position as to whether your company can overcome the challenges posed by SOX compliance if the decision is to go public, considering the impact of SOX compliance. Did not submit or incompletely supported your decision by identifying the potential advantages and disadvantages that SOX may have on your company, based on your research. Did not submit or incompletely provided specific examples.

Partially assessed the financial impact that SOX might have on your company if it decides to go public, by researching the results of SOX compliance surveys. Partially took a position as to whether your company can overcome the challenges posed by SOX compliance if the decision is to go public, considering the impact of SOX compliance. Partially supported your decision by identifying the potential advantages and disadvantages that SOX may have on your company, based on your research. Partially provided specific examples.

Satisfactorily assessed the financial impact that SOX might have on your company if it decides to go public, by researching the results of SOX compliance surveys. Satisfactorily took a position as to whether your company can overcome the challenges posed by SOX compliance if the decision is to go public, considering the impact of SOX compliance. Satisfactorily supported your decision by identifying the potential advantages and disadvantages that SOX may have on your company, based on your research. Satisfactorily provided specific examples.

Thoroughly assessed the financial impact that SOX might have on your company if it decides to go public, by researching the results of SOX compliance surveys. Thoroughly took a position as to whether your company can overcome the challenges posed by SOX compliance if the decision is to go public, considering the impact of SOX compliance. Thoroughly supported your decision by identifying the potential advantages and disadvantages that SOX may have on your company, based on your research. Thoroughly provided specific examples.

5. Make a recommendation as the CEO regarding the alternative (i.e., going public or staying private) that will best support the company’s expansion goals. Support your position.

Weight: 20%

Did not submit or incompletely made a recommendation as the CEO regarding the alternative (i.e., going public or staying private) that will best support the company’s expansion goals. Did not submit or incompletely supported your position.

Partially made a recommendation as the CEO regarding the alternative (i.e., going public or staying private) that will best support the company’s expansion goals. Partially supported your position.

Satisfactorily made a recommendation as the CEO regarding the alternative (i.e., going public or staying private) that will best support the company’s expansion goals. Satisfactorily supported your position.

Thoroughly made a recommendation as the CEO regarding the alternative (i.e., going public or staying private) that will best support the company’s expansion goals. Thoroughly supported your position.

6. 4 references

Weight: 5%

No references provided

Does not meet the required number of references; some or all references poor quality choices.

Meets number of required references; all references high quality choices.

Exceeds number of required references; all references high quality choices.

7. Clarity, writing mechanics, and formatting requirements

Weight: 10%

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