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Which of the following measures are contained in the Sarbanes–Oxley Act, 2002 of the United States? Disclosure of whether the audit committee includes a financial expert Establishment of the Public…

Question and options

Which of the following measures are contained in the Sarbanes–Oxley Act, 2002 of the United States?

  1. Disclosure of whether the audit committee includes a financial expert
  2. Establishment of the Public Company Accounting Oversight Board
  3. Certification of periodic reports by the principal executive and financial officers
  4. Mandatory rotation of the audit firm every five years

  1. 1, 2, 3 and 4

  2. 2 and 3 only

  3. 1, 2 and 3 only

  4. 1 and 2 only

Answer and explanation

Correct answer: C - 1, 2 and 3 only

The Sarbanes–Oxley Act set up the Public Company Accounting Oversight Board (section 101), requires the chief executive and chief financial officers to certify periodic reports (section 302) and requires disclosure of whether the audit committee has a financial expert (section 407). It rotates only the lead and concurring audit partners every five years (section 203) and merely called for a study of audit-firm rotation (section 207).

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