write a 200 word reply to this : "Sarbanes-Oxley (SOX), Public Companies Accounting Oversight Board (PCAOB) and the effects on auditing practices." The effects of the Sarbanes-Oxley (SOX) and the Public Companies Accounting Oversight Board (PCAOB) on auditing practices changed the way auditors and their client's conducted business after the Enron and WorldCom scandals. These scandals rocked the financial world and diminished the confidence of investors overnight. There were several pre-existing factors leading up to the need to pass the Sarbanes-Oxley act, which was signed into law on July 30, 2002. The Enron scandal was only partially to blame for this massive overhaul of the financial and accounting industries. "A 2002 GAO study found that between January 1997 and June 2002, the number of restatements due to accounting irregularities grew an average of 145 percent annually, with about 10 percent of all listed public companies announcing at least one restatement." (Auditing the Auditors: Creating the Public Company Accounting Oversight Board, SEC Historical Society). Another factor that brought light to the conflict was the fact that Arthur Anderson, the auditor for Enron, earned more from Enron in non-audit fees including consulting, than from auditing fees. This required a change in the financial oversight and corporate responsibilities to restore the confidence of investors. There must be a separation of auditing and consulting services, and this is one of the standards