Under the Sarbanes-Oxley Act, the Audit Committee of a Public

question 40

Multiple Choice

Under the Sarbanes-Oxley Act, the audit committee of a public company has the following requirement(s) :

• A)each member of the committee must be a board member and shall be independent.
• B)the audit committee must preapprove all audit and nonaudit services.
• C)the audit committee must establish and maintain procedures to handle all issues that relate to accounting, internal control, and auditing.
• D)All of these.

---

Definitions:

Product Ranking

The process of ordering products based on criteria such as sales performance, profitability, or strategic importance.

Variable Selling Expense

Costs that vary directly with the level of sales, such as commissions and credit card fees, as opposed to fixed selling expenses like salaries.

Specialized Machine

Equipment designed for a specific, often complex, function or process within manufacturing or production, not readily substitutable.

Financial Advantage

The benefit gained from making particular investment or financial decisions, often leading to increased wealth or reduced costs.