Multiple Choice
Serious ethical violations by corporations such as Enron led to the passage of which of the following acts?
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6. Internal Controls and Reporting Cash
Sarbanes-Oxley Act
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Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
Because of the Sarbanes-Oxley Act, accountants must maintain financial documents and audit work for how many years?
A
5 years
B
7 years
C
3 years
D
10 years
Verified step by step guidance1
Understand the context of the Sarbanes-Oxley Act (SOX), which was enacted to improve corporate governance and accountability, particularly in financial reporting and auditing.
Recognize that SOX requires accountants and auditors to retain financial documents and audit work papers for a specific period to ensure transparency and compliance.
Review Section 802 of the Sarbanes-Oxley Act, which explicitly states the retention period for audit work papers and financial documents.
Identify the correct retention period mandated by SOX, which is 7 years, as specified in the legislation.
Compare the given options (5 years, 7 years, 3 years, 10 years) and confirm that the correct answer aligns with the legal requirement of 7 years.
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