Which of the Following Statements Is True of the Sarbanes-Oxley

question 29

Multiple Choice

Which of the following statements is true of the Sarbanes-Oxley Act?

• A) The act can apply to international companies if they are registered with the Securities and Exchange Commission (SEC).
• B) The act focuses on lessening the responsibilities of the auditors.
• C) The act requires the auditors to have a close working relationship with the company's CFO, accounting staff, and other company officials.
• D) The act is inapplicable to public companies.
• E) The act mandates the certification of internal financial controls.

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Definitions:

Pure Play Method

A valuation method that compares a company to others within the same industry or sector with a single focus or product line.

Firm's Cost of Capital

The minimum return that a company must earn on its investments to maintain its market value and satisfy its creditors and investors.

Specific Division

A distinct business unit within a larger organization, often focused on a particular product line or market segment.

Risk Averse Manager

A manager who prioritizes minimizing risks in decision-making and strategy, favoring safer investments with potentially lower returns.