The Sarbanes-Oxley Act (SOX) Does Not Require Public Companies to Apply

question 9

True/False

The Sarbanes-Oxley Act (SOX) does not require public companies to apply both accounting oversight and stringent internal controls.

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Definitions:

Activity

Any action or task undertaken by individuals or groups, often resulting in production or consumption of goods or services.

External Costs

Costs of economic activities that affect third parties outside the transaction, which are not reflected in market prices.

Tax

A compulsory financial charge or levy imposed by a government on individuals or entities to fund public expenditures.

Negative Externality

Occurs when a decision by an individual or firm results in unwanted negative effects on another party not involved in the decision.