The Reporting Requirements for Fraud Are Detailed in Section 10A

question 87

Multiple Choice

The reporting requirements for fraud are detailed in Section 10A of the Securities Exchange Act of 1934. Which of the following steps are NOT part of a prescribed process that should be followed in deciding whether to report fraud?

• A) Determine who is responsible for the fraud.
• B) Determine whether the violations have a material effect, quantitatively or qualitatively, on the financial statements.
• C) Determine whether appropriate remedial action has been taken.
• D) Determine whether reporting to the SEC is necessary.

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Definitions:

Basic Accounting Equation

Assets equal liabilities plus equity; the foundational equation in accounting expressing the principle of balance in a firm's financial position.

Owner's Equity

The remaining value of a company's assets after all liabilities have been subtracted, indicating the stake of ownership in the enterprise.

Assets

Economic resources or owned valuables that are expected to provide future benefits to a business.

Liabilities

Economic obligations or debts that an entity is required to pay to another party.