ACCT 1A CH 4

High profile accounting scandals in the early 2000s prompted the passage of the: SEC Act of 1934 SEC Act of 1933 Sarbanes-Oxley Act PCAOB Auditing Standard No. 2

Sarbanes-Oxley Act

The two most common sources of occupational fraud are: financial statement manipulation personal tax evasion employee misrepresentation to outside stakeholders misuse of company resources

financial statement manipulation misuse of company resources

The use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the employer's resources is called occupational ____________

fraud

The asset most susceptible to fraudulent activity is _________

cash

The Sarbanes-Oxley Act applies to companies that are required to file with the SEC. any company organized in the United States. companies that operate internationally. companies that are formed as partnerships.

companies that are required to file with the SEC.

The key provisions of the Sarbanes-Oxley Act include requiring that corporate executives certify financial statements. establishing the Securities and Exchange Commission. limiting the role of the FASB in accounting standard setting. restricting activities of auditors to prevent conflicts of interest. requiring documentation and assessing effectiveness of internal controls.

requiring that corporate executives certify financial statements. restricting activities of auditors to prevent conflicts of interest. requiring documentation and assessing effectiveness of internal controls.