AS 2201 was issued after passage of Section 404(b) of the Sarbanes-Oxley Act (SOX) of

2002, a provision of SOX that is most costly to the companies and (therefore) hotly debated.

Some opponents to this provision argue that the compliance costs for the requirement far

outweigh the benefits when all public companies are already having their financial statements

audited. Discuss the potential benefits to investors of having an external auditor audit and obtain

reasonable assurance on effectiveness of internal control over financial reporting.