As a Result of Recent Accounting Scandals Involving Companies Such

question 37

Multiple Choice

As a result of recent accounting scandals involving companies such as Enron and World Com,the Sarbanes-Oxley Act of 2002 was written to protect shareholders of public companies by improving

• A)management accounting.
• B)corporate governance.
• C)professional competence.
• D)the corporate legal process.

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Definitions:

Lease Capitalization

The process of recording a lease as an asset and a corresponding liability on the lessee's balance sheet, particularly for long-term leases.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that is used globally to prepare public company financial statements.

GAAP

Generally Accepted Accounting Principles; a framework of accounting standards, principles, and procedures.

Lease Capitalization

The process of recording a lease as an asset and a corresponding liability on the balance sheet, reflecting the assets' use and obligation to make lease payments.