1.3 Sarbanes-Oxley Act of 2002

SOA requires certain disclosures:

1. Adjusting entries 2. material off balance sheet transactions including leases, contingent obligations, and relationships with unconsolidated subsidiaries.

The Sarbanes-Oxley Act defines the responsibilities of the audit committee of an issuer as including?

1. Appointment 2. Compensation 3. Oversight (resolve disagreements and reports directly to the auditor)

Title IV of the Sarbanes-Oxley Act, Enhanced Financial Disclosures, includes the following topics:

1. Disclosures in reports 2. conflicts of interest 3. transactions involving management 4. assessment of IC 5. code of ethics 6. Disclosure of financial experts 7. Enhanced review of periodic disclosures by issuers

Under Title XI, Corporate Fraud Accountability, what are the penalties for tampering with a document used in an official proceeding or retaliating against an informant providing information to the SEC

1. Document tampering = fines or prison not more than 20 years 2. Retaliation against informant = fines or prison not more than 10 years

The Sarbanes Oxley Act defines the criteria for independence of the audit committee members as...?

1. Each member of the audit committee will be a member of the board but otherwise independent 2. not accept any consulting, advisory or other compensation or fees 3. not an affiliated person of the issuer of sub of the issuer (make financial decisions)

SOA assigns the following corporate responsibilities regarding internal controls that must accompany finc reports...?

1. Officers responsible for internal controls 2. IC designed to ensure that material info is provided to internal and external users 3. Internal controls have been evaluated within 90 days prior to report 4. officers conclusions of internal control as of evaluation date

The Sarbanes Oxley Act requires that an issuer's audit committee establish a complaint procedure that includes...?

1. Receipt, retention, and treatment of complaints regarding accounting, Internal controls, auditing 2. Confidential submission by employees

What qualifies an individual as a financial expert?

1. Understanding GAAP 2. Experience and Application of GAAP and IC 3. Education

SOA includes provisions for management assessment of internal controls:

1. adequate internal control structure 2. effectiveness of IC 3. auditors attestation regarding management's assessment of IC

SOA assigns the following corporate responsibilities regarding the required disclosures to the auditors and audit committee by officers:

1. certify that all significant deficiencies in the design or operation of internal controls 2. fraud, whether or not material, that involves management

An issuer periodic report containing finc statements filed with the SEC must include the following written certifications:

1. complies with securities and exchange act of 1934 2. information is presented fairly, in all material respects, the finc condition and operating results of the issuer. 3. Signed by CEO and CFO who bear responsibility

The Sarbanes Oxley act assigns the following corporate responsibilities for financial reports for issuers...?

CEO and CFO must have 1. Reviewed the report 2. no untrue statements or omit material info 3. fairly stated 4. sign off on internal control 5. disclose any control weakness 6. status of IC

Title XI of the Sarbanes Oxley Act considers what topics?

Corporate Fraud Accountability 1. tampering with records 2. freeze of authority for the SEC 3. SEC prohibits persons from serving as officers 4. Retaliation against informants

Title VIII of Sarbanes-Oxley Act considers what topics?

Criminal penalties Statute of limitations for securities fraud whistle blower protection criminal penalties for securities fraud

SOA includes provisions for the audit committee disclosures:

Disclosure the existence of a financial expert or why there is not one

SOA includes provisions for disclosure of transactions involving management or principle stockholders

If owns more than 10%

SOA includes enhanced conflict of interest provisions:

Prohibitions on personal loans to executives.

Title III of the Sarbanes-Oxley Act, "Corporate Responsibility," includes four topics pertaining to financial reporting. What are they?

Public company audit committees Corporate responsibility for financial reports Improper influence on conduct of audits Forfeiture of certain bonuses and profits

Title IX of the Sarbanes Oxley Act considers what topic?

White collar crime penalty enhancements 1. attempt and conspiracy 2. amended sentencing guidelines 3. failure of corporate officers to certify finc reports

SOA prohibits improper influence on the conduct of audits defined as:

dont take money or something