Who is obligated to comply with SOX regulations?

The obligation to comply with the Sarbanes-Oxley Act (SOX) primarily lies with all publicly traded companies. This legislation was enacted in response to major corporate and accounting scandals, and its main goal is to enhance corporate governance and accountability.

Publicly traded companies must adhere to specific requirements that include the establishment of internal controls, the certification of financial reports by executives, and the provision of greater transparency in financial reporting. These measures are intended to protect investors and ensure the accuracy of financial disclosures.

The other options do not accurately reflect the reach of SOX regulations. For instance, private companies are not subject to SOX unless they decide to go public. Similarly, foreign companies are only required to comply with SOX if they have publicly traded securities in the United States or if they file reports with the SEC. Furthermore, small businesses and startups that are not publicly traded do not have any obligations under SOX regulations. Thus, the requirement to comply is specifically tailored to publicly traded entities.