Public Companies ________

question 224

Multiple Choice

Public companies ________.

• A) must issue an internal control report which states that the outside auditor is responsible for the adequacy of internal controls
• B) are audited by accounting firms that do not also provide certain consulting services to the public company
• C) are required by the Financial Accounting Standards Board to maintain a system of internal controls
• D) are overseen by the Public Company Accounting Oversight Board

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Definitions:

Revised Model Business Corporation Act

An updated model statue designed to serve as a comprehensive guide for the structuring and governance of corporations in the United States.

Fiduciary Duty of Care

A legal obligation of one party to act in the best interest of another when entrusted with the care of their assets or interests.

Stock Subscription Agreement

A legal contract outlining the purchase of shares in a company by investors under specific terms and conditions.

Watered Stock

Stock that is issued to individuals below its fair market value.