Public Law 107–204 107th Congress An Act

1 116 STAT. 745 Public LAW 107 204 JULY 30, 2002 Public Law 107 204107th CongressAn ActTo protect investors by improving the accuracy and reliability of corporate disclosuresmade pursuant to the securities laws, and for other it enacted by the Senate and House of Representatives ofthe United States of America in Congress assembled,SECTION 1. SHORT TITLE; TABLE OF CONTENTS.(a) SHORTTITLE. This Act may be cited as the Sarbanes-Oxley Act of 2002 .(b) TABLE OFCONTENTS. The table of contents for this Actis as follows:Sec. 1. Short title; table of 2.

2 3. Commission rules and I Public COMPANY ACCOUNTING OVERSIGHT BOARDSec. 101. Establishment; administrative 102. Registration with the 103. Auditing, quality control, and independence standards and 104. Inspections of registered Public accounting 105. Investigations and disciplinary 106. Foreign Public accounting 107. Commission oversight of the 108. Accounting 109. II AUDITOR INDEPENDENCESec. 201. Services outside the scope of practice of 202. Preapproval 203. Audit partner 204. Auditor reports to audit 205.

3 Conforming 206. Conflicts of 207. Study of mandatory rotation of registered Public accounting 208. Commission 209. Considerations by appropriate State regulatory III CORPORATE RESPONSIBILITYSec. 301. Public company audit 302. Corporate responsibility for financial 303. Improper influence on conduct of 304. Forfeiture of certain bonuses and 305. Officer and director bars and 306. Insider trades during pension fund blackout 307. Rules of professional responsibility for 308. Fair funds for IV ENHANCED FINANCIAL DISCLOSURESSec.

4 401. Disclosures in periodic 402. Enhanced conflict of interest 403. Disclosures of transactions involving management and principal USC of 30, 2002[ 3763]VerDate 11-MAY-2000 09:34 Sep 09, 2004 Jkt 019194 PO 00000 Frm 00001 Fmt 6580 Sfmt 6582 O:\TURNEY\ APPS10 PsN: PUBL204116 STAT. 746 Public LAW 107 204 JULY 30, 2002 Sec. 404. Management assessment of internal 405. 406. Code of ethics for senior financial 407. Disclosure of audit committee financial 408. Enhanced review of periodic disclosures by 409.

5 Real time issuer V ANALYST CONFLICTS OF INTERESTSec. 501. Treatment of securities analysts by registered securities associations andnational securities VI COMMISSION RESOURCES AND AUTHORITYSec. 601. Authorization of 602. Appearance and practice before the 603. Federal court authority to impose penny stock 604. Qualifications of associated persons of brokers and VII STUDIES AND REPORTSSec. 701. GAO study and report regarding consolidation of Public accounting 702. Commission study and report regarding credit rating 703.

6 Study and report on violators and violationsSec. 704. Study of enforcement 705. Study of investment VIII CORPORATE AND CRIMINAL FRAUD ACCOUNTABILITYSec. 801. Short 802. Criminal penalties for altering 803. Debts nondischargeable if incurred in violation of securities fraud 804. Statute of limitations for securities 805. Review of Federal Sentencing Guidelines for obstruction of justice and ex-tensive criminal 806. Protection for employees of publicly traded companies who provide evi-dence of 807. Criminal penalties for defrauding shareholders of publicly traded IX WHITE-COLLAR CRIME PENALTY ENHANCEMENTSSec.

7 901. Short 902. Attempts and conspiracies to commit criminal fraud 903. Criminal penalties for mail and wire 904. Criminal penalties for violations of the Employee Retirement Income Se-curity Act of 905. Amendment to sentencing guidelines relating to certain white-collar 906. Corporate responsibility for financial X CORPORATE TAX RETURNSSec. 1001. Sense of the Senate regarding the signing of corporate tax returns bychief executive XI CORPORATE FRAUD AND ACCOUNTABILITYSec. 1101. Short 1102. Tampering with a record or otherwise impeding an official 1103.

8 Temporary freeze authority for the Securities and Exchange 1104. Amendment to the Federal Sentencing 1105. Authority of the Commission to prohibit persons from serving as officersor 1106. Increased criminal penalties under Securities Exchange Act of 1107. Retaliation against 2. DEFINITIONS.(a) INGENERAL. In this Act, the following definitions shallapply:(1) APPROPRIATE STATE REGULATORY AUTHORITY. The term appropriate State regulatory authority means the Stateagency or other authority responsible for the licensure or otherregulation of the practice of accounting in the State or States15 USC 11-MAY-2000 09:34 Sep 09, 2004 Jkt 019194 PO 00000 Frm 00002 Fmt 6580 Sfmt 6581 O:\TURNEY\ APPS10 PsN: PUBL204116 STAT.

9 747 Public LAW 107 204 JULY 30, 2002having jurisdiction over a registered Public accounting firmor associated person thereof, with respect to the matter inquestion.(2) AUDIT. The term audit means an examination ofthe financial statements of any issuer by an independent publicaccounting firm in accordance with the rules of the Boardor the Commission (or, for the period preceding the adoptionof applicable rules of the Board under section 103, in accordancewith then-applicable generally accepted auditing and relatedstandards for such purposes), for the purpose of expressingan opinion on such statements.

10 (3) AUDITCOMMITTEE. The term audit committee means (A) a committee (or equivalent body) established byand amongst the board of directors of an issuer for thepurpose of overseeing the accounting and financialreporting processes of the issuer and audits of the financialstatements of the issuer; and(B) if no such committee exists with respect to anissuer, the entire board of directors of the issuer.(4) AUDIT REPORT. The term audit report means a docu-ment or other record (A) prepared following an audit performed for purposesof compliance by an issuer with the requirements of thesecurities laws; and(B) in which a Public accounting firm either (i) sets forth the opinion of that firm regardinga financial statement, report, or other document; or(ii) asserts that no such opinion can be expressed.