Question:* What does SOX represent?
Answer: • Sarbanes Oxley Act of 2002
Question:* Which agency provides many of the details of SOX regulation?
Answer: • U.S. Securities and Exchange Commission
Question:* Which Act was passed to cut back on multiple regulatory requirements and coincided with the tenth anniversary of SOX?
Answer: • Jumpstart Our Business Startups Act
Question:* How many public accountants can there be on the PCAOB Board?
Answer: • Two only
Question:* Which of the following are not relevant for the success of Section 404 Projects?
Answer: • Supported by Banks and Lending Institutions
Question:* Which Sarbanes-Oxley Act section mandates that a corporation’s registered accounting firm must attest to the effectiveness of the internal control structure and procedures for financial reporting?
Answer: • Section 404
Question:* The Dodd-Frank financial reform bill permanently exempts small-companies from which key provision of section 404 of the Sarbanes-Oxley act?
Answer: • Annual outside audits
Question:* Which section of the Sarbanes-Oxley Act requires corporations to publish information concerning the scope and adequacy of their internal control structure and their procedures for financial reporting?
Answer: • Section 404
Question:* Which group is responsible for reviewing logs in financial systems?
Answer: • System Administrator or Auditor with no interest in the system
Question:* How many SOX titles (sections) have been ammended?
Answer: • Four
Question:* For how many years can a public accounting firm audit the same client?
Answer: • Five years
Question:* Which of the following tools has been largely adopted as part of Sarbanes Oxley IT Compliance?
Answer: • COBIT
Question:* Along with the IT department who else in a company is responsible for creating a Sarbanes-Oxley compliant system?
Answer: • Senior management
Question:* Under Sarbanes-Oxley’s corporate responsibility provision, the Chief Executive Officer and Chief Financial Officer must certify and approve:
Answer: • the integrity of their company's financial reports quarterly
Question:* Which of the Management representations is not part of Financial Statement Assertions?
Answer: • Definition
Question:* Which of the following was established by the Sarbanes-Oxley Act?
Answer: • Public Company Accounting Oversight Board
Question:* In general, Sarbanes-Oxley raised financial standards in which three main areas?
Answer: • Corporate governance, financial oversight, and the performance of audit work.
Question:* How did title IV of the Sarbanes-Oxley Act enhance the reporting requirements for financial transactions?
Answer: • Off-balance-sheet transactions must be disclosed
Question:* The high cost of implementing the Sarbanes-Oxley Act has motivated some companies to do which of the following?
Answer: • Delist their shares from the major exchanges
Question:* SOX's audit committee provision requires publicly traded corporations to establish procedures for:
Answer: • employees filing internal whistleblower complaints
Question:* Which accounting firms are subject to PCAOB annual inspections?
Answer: • With audits of more than 100 public companies
Question:* When does risk assessment lead to more robust testing of all relevant assertions for significant accounts?
Answer: • Higher Risk Cycles
Question:* The Sarbanes-Oxley Act (SOX) mandated strict reforms to improve financial disclosures from corporations and prevent what type of fraud?
Answer: • Accounting
Question:* Why is the Sarbanes-Oxley Act widely considered as the most important securities legislation since the original federal securities laws of the 1930s?
Answer: • It re-established investor confidence in the integrity of corporate disclosures and financial reporting.
Question:* What is the primary function of SAG (Standing Advisory Group)?
Answer: • To advise PCAOB on establishment of auditing and related professional practice standards
Question:* Which of the following was established by Congress to oversee the audits of public companies?
Answer: • Public Company Accounting Oversight Board
Question:* Which agency enforces every aspect of SOX, including the various whistleblower-related provisions?
Answer: • Securities and Exchange Commission
Question:* What was the Sarbanes Oxley Act also known as?
Answer: • Public Company Accounting Reform and Investor Protection Act
Question:* What companies need to comply with Sarbanes-Oxley?
Answer: • All publicly-traded companies in the United States
Question:* Who would be affected by Section 306 of the Sarbanes-Oxley Act, which prohibits purchasing or selling any equity security during a pension plan blackout period?
Answer: • The director or executive officer of a public company
Question:* Which of the following activities is performed during the Scoping Phase of a SOX project?
Answer: • Identify significant accounts, business processes and locations
Question:* What is the purpose of the SOX Act?
Answer: • To protect investors by improving the accuracy and reliability of corporate disclosures
Question:* Which of the following is a specific requirement of the Sarbanes-Oxley Act?
Answer: • Publicly traded corporations must create internal and independent audit committees.
Question:* How can we identify the existence of Internal Control Deficiency?
Answer: • When the operation of a control does not detect misstatements
Question:* The Sarbanes-Oxley Act was enacted in response to the accounting scandals conducted by which of the following companies?
Answer: • Enron, Tyco, & WorldCom
Question:* Which statement is true regarding a company that is out of compliance with the Sarbanes-Oxley Act?
Answer: • It depends on which section of the act they’re out of compliance with
Question:* The Sarbanes-Oxley Act of 2002 is a piece of legislation created for the purpose of protecting investors from accounting fraud, specifically:
Answer: • Disclosures related to earnings and profitability
Question:* Which problem was The Sarbanes-Oxley Act primarily focused on fixing?
Answer: • Fraudulent reporting of selected financial transactions
Question:* Who is responsible for appointing the Chair and members of PCAOB?
Answer: • Securities and Exchange Commission
Question:* Employees who prevail in a SOX whistle-blowing action are entitled to which of the following?
Answer: • Employment reinstatement
Question:* Under the Sarbanes-Oxley Act, how long must commercial firms keep their business records (including electronic records and electronic messages)?
Answer: • 5 years
Question:* Under section 404 of Sarbanes Oxley, a registered auditor's report must verify that a company:
Answer: • has internal accounting controls in place
Question:* The Sarbanes-Oxley Act was passed by Congress to restore investor confidence in which aspects of a publically traded company’s operations?
Answer: • Financial statements
Question:* Which is the primary function of the IT departments of Sarbanes-Oxley?
Answer: • Storage of electronic financial records
Question:* Who exposes misconduct either internally or externally in an organization called?
Answer: • Whistleblower
Question:* How does the enforcement of the Sarbanes-Oxley Act help protect ordinary securities investors?
Answer: • Requires notification of insider trading transactions
Question:* A company that violates Sarbanes-Oxley Act compliance is subject to which of the following sanctions?
Answer: • Significant fines
Question:* Which of the following is NOT part of the 11 sections of the SOX Act?
Answer: • Income Tax Returns
Question:* What is a Sarbanes-Oxley auditor required to review during a Section 404 audit?
Answer: • Internal controls, policies, and procedures
Question:* Which is the official acronym for the Sarbanes-Oxley Act of 2002?
Answer: • SOX
Question:* Under SOX, E-mail is considered a business record and must be:
Answer: • Encrypted and password protected
Question:* The American Competitiveness and Corporate Accountability Act of 2002, is commonly known as:
Answer: • The Sarbanes-Oxley Act
Question:* Under Sarbanes-Oxley, the board of directors of most public companies must appoint which of the following committees?
Answer: • Audit
Question:* Auditors were not the only targets of Sarbanes-Oxley. The act also includes a broad range of provisions dealing with:
Answer: • Corporate governance
Question:* Which services can a Public Accounting Audit Firm perform for the same client?
Answer: • Evaluating and understanding the Internal Control System
Question:* Which of the following is to be avoided in documenting flowchart in business processes?
Answer: • Detailed process description
Question:* What are Internal Controls within business entities also known as?
Answer: • Operational Controls
Question:* As per the SEC, who is qualified to certify each quarterly or annual report of the public companies per Section 302?
Answer: • CEO and CFO
Question:* Under Sarbanes-Oxley, what is the CEO's responsibility in regards to corporate taxes?
Answer: • The CEO must sign the company’s tax return
Question:* Which of the following is a feature of Automated Control?
Answer: • Edit Check activated during data entry
Question:* Which type of evidence cannot be used by Auditors to reduce the extent of their testing?
Answer: • Evidence is furnished by the person who performs that control
Question:* Who would be affected by Section 307's standards for professional conduct?
Answer: • Attorneys appearing and practicing before the SEC
Question:* For how many years do registered accounting firms have to maintain audit work papers?
Answer: • Seven Years
Question:* What is the main requirement of SOX Section 404(a)?
Answer: • Management is required to report on the effectiveness of the company's internal controls over financial reporting
Question:* Which of the following is NOT a Form of Certification as per SEC?
Answer: • Form 30-K
Question:* Besides the management of a company, who else would be held responsible for non-compliance with the Sarbanes-Oxley's business record keeping provision?
Answer: • The IT department
Question:* Which of the following companies does NOT have to comply with the all of The Sarbanes Oxley Act's regulatory mandates?
Answer: • Koch Industries
Question:* Which organization is responsible for the Internal Control Framework as required by SOX?
Answer: • The Committee of Sponsoring Organizations
Question:* Identify the sub process of a Receivables Business Process.
Answer: • Pricing
Question:* The Sarbanes-Oxley criminalizes retaliation against whistleblowers that provide “truthful information” to a “law enforcement officer” about the “commission or possible commission of any Federal offense,”. Who does this provision apply to?
Answer: • Every employer nationwide
Question:* The Sarbanes-Oxley Act applies to which non US companies?
Answer: • Registered equity or debt securities with the SEC and the accounting firms that provide auditing services to them
Question:* Which organization created COBIT as a framework for IT Management and Governance?
Answer: • ISACA
Question:* Which section of the Sarbanes-Oxley Act requires senior management to certify the accuracy of data reported in their company’s financial statement?
Answer: • Section 302
Question:* Who can be a chairperson of PCAOB?
Answer: • A CPA who has not been a practicing for at least five years prior to being appointed to the board
Question:* Which of the following is a Material Weakness leading to Audit Failure?
Answer: • Detection of fraud by external auditors and not internal auditors
Question:* In order to determine significant accounts, Management must consider the concept of Materiality. Which of the following is a Quantitative consideration of Materiality?
Answer: • Product Revenues
Question:* Within Sarbanes-Oxley, who is tasked with registering auditors, and defining the specific procedures for compliance audits?
Answer: • Public Company Accounting Oversight Board
Question:* Under the Sarbanes-Oxley Act, if a public company makes a “required” accounting restatement due to “misconduct,” what could happen to that company’s CEO and CFO?
Answer: • Forced to forfeit any bonuses or profits gained from selling company stock
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