SARBANES-OXLEY ACT Definition

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SARBANES-OXLEY ACT (SOX) contains sweeping reforms for issuers of publicly traded securities, auditors, corporate board members, and lawyers. It adopts tough new provisions intended to deter and punish corporate and accounting fraud and corruption, threatening severe penalties for wrongdoers, and protecting the interests of workers and shareholders. The Sarbanes-Oxley Act of 2002, was signed into law by US President George W. Bush and became effective on July 30, 2002.

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PHANTOM PROFIT is hypothetical profit, i.e., no cash flow is generated. Appreciation on any asset, e.g. stock, is considered phantom profit unless or until the asset is sold, thereby generating cash flow.

E&P is Earnings and Profits.

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