Internal control has two main objectives. The first goal is to protect assets from theft, employee theft, and other unauthorized use. The second objective is to ensure the reliability and accuracy of accounting records. This step aims to reduce the risk of errors, intentional or not, in the accounting process. The Sarbanes-Oxley Act was implemented in 2002. This law was implemented following a number of accounting scandals that resulted in the loss of billions of dollars. dollars to investors. This law has eleven articles that range from additional responsibilities of the company's board of directors to criminal sanctions. This law made companies more responsible in their accounting practices. If a company knowingly falsifies, conceals, conceals, destroys or falsifies any records in order to prevent, obstruct or influence any investigation into violations of the law, it may be fined or imprisoned up to twenty years, or both. This requires companies to take responsibility for their actions. A company that announces deficiencies in its internal controls would experience a decline in its stock for several reasons. Following the unethical practices of companies such as Enron, Tyco, Global Crossing and Worldcom, which resulted in investors losing billions of dollars, a company with inadequate accounting practices would not be a good investment. If a company announced deficiencies in its internal controls, shareholders would rush to dump their shares. In doing so, the stock price of that company would fall. Nobody wants unstable stocks. One of the limitations of internal controls is that they can only provide reasonable assurance, due to the limitations inherent in any internal control system... middle of paper ... its irregularities. Internal controls are an important factor in the growth and value of a company. Proper accounting practices play an important role in this process. Following the scandal caused by the unethical practices used by companies such as Enron, Tyco, Global Crossing and Worldcom, the Sarbanes-Oxley Act of 2002 was signed into law. This law held businesses accountable for their actions. Businesses could face fines, imprisonment or both if the law is not followed. Additionally, if there are deficiencies in a company's internal controls, stock prices may fall. Many physical, mechanical and electronic controls are involved in internal controls. Some of these are good controls while others, while useful, are not as effective as others. Works Cited Internal Control and Treasury The American Institute of Certified Public Accountants Wikipedia