The "Clawback" Provision in the _____ Allows a Company to Recover

question 18

Multiple Choice

The "clawback" provision in the _____ allows a company to recover any incentive-based pay that was paid out during the prior three years if it would not have been paid under restated financial statements.

• A) Sarbanes-Oxley Act
• B) Dodds-Frank Act
• C) Lilly Ledbetter Fair Pay Act
• D) Walsh-Healy Public Contracts Act

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Definitions:

Uncollectible Accounts

Debts owed to a company that are considered to be uncollectible and are thus written off as a bad debt expense.

Allowance Method

An accounting technique used to estimate uncollectable accounts receivable within a company's financial statements.

Bad Debt Expense

An accounting term representing the amount of revenue considered uncollectible from credit sales.

Allowance for Doubtful Accounts

A contra-asset account that reduces the total receivables balance to reflect the amount that is expected to be uncollectible.