This leaves it to the newly created Oversight Board to determine what standards are acceptable in the treatment of options. As noted by Mr. Buffett, supra, this leaves open the loopholes that are created by the 1994 Securities Act. There is no requirement that corporations accurately reflect executive compensation as an expense on their financial reports. Thus, it is still possible that earnings statements by corporations remain 3-5% higher than actual corporate earnings, even with the enactment of Sarbanes-Oxley. This can become problematic, as shareholders will not have accurate information upon which they can act upon to ensure accountability in their Boards of Directors. An excellent example of this can be found in the Walt Disney Co. Derivative Litigation wherein shareholders challenged compensation programs awarding astounding amounts of money to Michael Ovitz as part of a "golden parachute". The creation of the new Oversight Board fails to directly address the true problems of recent corporate fraud: direct accountability of corporate boards to their shareholders. .

             Section 101 of the Act establishes the Public Company Accounting Oversight Board (PCAOB) which is entrusted to adopt policies and create an annual report format that will be submitted to the SEC, and that report is submitted by the corporation to the Senate Committee on Banking, Housing, and Urban Affairs. Basically, the PCAOB acts as an ethics advisory committee (in New Jersey, the closest equivalent is the Supreme Court Committee on Attorney Ethics) for those accountants that engage in audits of public companies. The Board is able to discipline accountants that engage in misconduct during public audits. The Board will set the standards used in accounting practices. In other words, the Board decides what is an appropriate accounting formula – a troubling scenario.

             The first problem with the Board is simple. Although the Board will be able to punish "bad" accountants a simple rhetorical question remains: were we not able to punish "bad" accountants in the past? The answer is, of course, no.