Which of the Following Statements Regarding Auditors Is False

question 23

Multiple Choice

Which of the following statements regarding auditors is false?

• A) The Sarbanes-Oxley Act called on the SEC to force companies to have audit committees that are dominated by outside directors and required that at least one outside director have a financial background.
• B) Whether information is material has been defined in the courts as referring to whether the information would have been a significant factor in an investor's decision about the value of the security.
• C) CEOs and CFOs must return bonuses or profits from the sale of stock or the exercise of options during any period covered by statements that are later restated.
• D) The law is especially strict with regard to takeover announcements, prohibiting any insider with nonpublic information about a pending or ongoing tender offer from trading on that information or revealing it to someone who is likely to trade on it.

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Definitions:

Directional Control

The mechanism or system used to steer or change the direction of a vehicle or a machine part.

Pilot

Any of a number of devices that receives a signal and then effects an action; can also be known as a relay.

Spool

A cylindrical device around which materials such as thread, wire, or film are wound for storage.

Swashplate Pump

A type of hydraulic pump where a rotating swashplate controls the flow of fluid, used in various high-pressure hydraulic systems.