Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

6. Internal Controls and Reporting Cash

Sarbanes-Oxley Act

Financial Accounting

6. Internal Controls and Reporting Cash

Sarbanes-Oxley Act

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Multiple Choice

Which of the following is a requirement of the Sarbanes-Oxley Act?

The CEO and CFO must personally certify the accuracy of financial statements.

Public companies must establish internal controls over financial reporting.

Auditors are prohibited from providing any tax services to their audit clients.

Private companies must file quarterly reports with the SEC.

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Verified step by step guidance

Understand the Sarbanes-Oxley Act (SOX): The Sarbanes-Oxley Act was enacted in 2002 to improve corporate governance and accountability, primarily for public companies. It aims to protect investors by ensuring the accuracy and reliability of corporate disclosures.

Identify the key requirements of SOX: The Act mandates several provisions, including the personal certification of financial statements by the CEO and CFO, the establishment of internal controls over financial reporting, and restrictions on auditors providing certain non-audit services to their audit clients.

Evaluate the options provided in the problem: Review each statement to determine whether it aligns with the requirements of SOX. For example, the certification of financial statements by the CEO and CFO and the establishment of internal controls are direct requirements of SOX.

Eliminate incorrect options: For instance, private companies are not required to file quarterly reports with the SEC under SOX, and auditors are not entirely prohibited from providing tax services to their audit clients, though certain restrictions apply.

Select the correct answers: Based on the analysis, choose the options that accurately reflect the requirements of the Sarbanes-Oxley Act, such as the CEO and CFO certification and the establishment of internal controls over financial reporting.