R5 - Sarbanes Oxley Act of 2002

Code of ethics for SOX

-Compliance with laws, rules, and regulations. -Full, fair, accurate, and timely disclosure in periodic financial statements. -Honest and ethical conduct. *does not include prompt internal reporting of code provisions and accountabliity for adherence

Financial expert

-Each company must have a financial expert -If company does not have a financial expert, must disclose why -Must be able to GAAP

What type of salary can the board members attain?

-Regular Salary (board member salary) -No president salary is allowed

Are public companies required to establish an audit committee?

-Yes

How long does firms need to keep accounting records?

7 years

Conflict of interest provisions of the Sarbanes-Oxley Act of 2002 generally prohibit the directors or executive officers of public companies from:

Receiving a personal loan from the issuer not in the ordinary course of business.

Define issuer

The term "issuer" means an issuer (as defined in section 3 of the Securities Exchange Act of 1934), the securities of which are registered under section 12 of that Act, or that is required to file reports under section 15(d), or that files or has filed a registration statement that has not yet become effective under the Securities Act of 1933, and that it has not withdrawn.

A CPA firm must do which of the following before it can participate in the preparation of an audit report of a company registered with the Securities and Exchange Commission (SEC)?

To participate in the preparation of audit reports for a company registered with the SEC, a CPA firm must first register with the Public Company Accounting Oversight Board.

How often does the lead on audit need to rotate?

every 5 years