The following post comes to us from Francesco Bova, Miguel Minutti-Meza and Gordon Richardson of the Accounting Department at the University of Toronto; and Dushyantkumar Vyas of the Accounting Department at the University of Minnesota.
In the paper, The Sarbanes-Oxley Act and Exit Strategies of Private Firms, which was recently made publicly available on SSRN, we examine the costs of SOX compliance for private firms wanting to exit the private market via either an acquisition by a public firm or an IPO. The costs and benefits of the Sarbanes-Oxley Act of 2002 (SOX) have been oft-debated since the inception of the Act. However, much of the extant literature has assessed the costs and benefits of SOX to publicly-traded companies.