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Exam 2—Part 3 ESSAY

The Sarbanes Oxley Act of 2002 was enacted as a reaction to the fraud perpetrated at Enron and the perceived lack of independence and professional skepticism of Anderson’s auditors. Discuss the following: 

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· Define independence and professional skepticism.

· Why did regulators believe Anderson’s auditors lacked these important professional characteristics?

· Briefly explain the main change to auditor services enacted by SOX. Why did regulators believe this change would improve auditor independence and professional skepticism?

Note that this essay will be graded through TurnItIn and must be IN YOUR OWN WORDS. It should consist of approximately 250-400 words. Your essay should be in business report format:  single spaced, 12 pt. font, one-inch margins, i.e. formal business writing with proper grammar and punctuation. You should include appropriate parenthetical citations and a Works Cited page in APA style. Note that for business report format, paragraphs should not be indented and there should only be double spaces between paragraphs. 

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