Question

Are Sarbanes-Oxley Act of 2002 and AICPA Code of Professional Conduct the same? How are they related to each other?

Answer 1

No, they are not same. Sarbanes–Oxley Act of 2002 is a United States federal law enacted by the 107th United States Congress and is applicable on Corporates. While AICPA code is issued by American Institute of Certified Public Accountants for CPA's only.

The Sarbanes–Oxley Act of 2002 (Pub.L. 107–204, 116 Stat. 745, enacted July 30, 2002), also known as the "Public Company Accounting Reform and Investor Protection Act" (in the Senate) and "Corporate and Auditing Accountability, Responsibility, and Transparency Act" (in the House) and more commonly called Sarbanes–Oxley, Sarbox or SOX, is a United States federal law that set new or expanded requirements for all U.S. public company boards, management and public accounting firms. There are also a number of provisions of the Act that also apply to privately held companies; for example, the willful destruction of evidence to impede a Federal investigation.

The bill, which contains eleven sections, was enacted as a reaction to a number of major corporate and accounting scandals, including Enron and WorldCom. The sections of the bill cover responsibilities of a public corporation’s board of directors, adds criminal penalties for certain misconduct, and required the Securities and Exchange Commission to create regulations to define how public corporations are to comply with the law.

The AICPA Code of Professional Conduct is a collection of codified statements issued by the American Institute of Certified Public Accountants that outline a CPA's ethical and professional responsibilities.^[1] The code establishes standards for auditor independence, integrity and objectivity, responsibilities to clients and colleagues and acts discreditable to the accounting profession. The AICPA is responsible for drafting, revising and reissuing the code annually, on June 1. The current Code is available at the AICPA Web site. For older versions of the Code, see the links below.