General Sarbanes-Oxley MCQs

1. What does SOX represent?

2. In general, Sarbanes-Oxley raised financial standards in which three main areas?

3. What was the Sarbanes Oxley Act also known as?

4. Which of the following activities is performed during the Scoping Phase of a SOX project?

5. For how many years do registered accounting firms have to maintain audit work papers?

6. The Sarbanes-Oxley Act (SOX) mandated strict reforms to improve financial disclosures from corporations and prevent what type of fraud?

7. Who would be affected by Section 307's standards for professional conduct?

8. Which agency provides many of the details of SOX regulation?

9. How does the enforcement of the Sarbanes-Oxley Act help protect ordinary securities investors?

10. The Sarbanes-Oxley Act was passed by Congress to restore investor confidence in which aspects of a publically traded company’s operations?

11. Which of the following is a specific requirement of the Sarbanes-Oxley Act?

12. What companies need to comply with Sarbanes-Oxley?

13. Which agency enforces every aspect of SOX, including the various whistleblower-related provisions?

14. A company that violates Sarbanes-Oxley Act compliance is subject to which of the following sanctions?

15. Under section 404 of Sarbanes Oxley, a registered auditor's report must verify that a company:

16. What is a Sarbanes-Oxley auditor required to review during a Section 404 audit?

17. Which is the primary function of the IT departments of Sarbanes-Oxley?

18. Auditors were not the only targets of Sarbanes-Oxley. The act also includes a broad range of provisions dealing with:

19. Under SOX, E-mail is considered a business record and must be:

20. The American Competitiveness and Corporate Accountability Act of 2002, is commonly known as:

21. Under the Sarbanes-Oxley Act, how long must commercial firms keep their business records (including electronic records and electronic messages)?

22. How can we identify the existence of Internal Control Deficiency?

23. Which statement is true regarding a company that is out of compliance with the Sarbanes-Oxley Act?

24. Which problem was The Sarbanes-Oxley Act primarily focused on fixing?

25. Employees who prevail in a SOX whistle-blowing action are entitled to which of the following?

26. Who is responsible for appointing the Chair and members of PCAOB?

27. The Sarbanes-Oxley Act was enacted in response to the accounting scandals conducted by which of the following companies?

28. Who exposes misconduct either internally or externally in an organization called?

29. Which is the official acronym for the Sarbanes-Oxley Act of 2002?

30. Under Sarbanes-Oxley, the board of directors of most public companies must appoint which of the following committees?

31. Which of the following was established by Congress to oversee the audits of public companies?

32. 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?

33. Why is the Sarbanes-Oxley Act widely considered as the most important securities legislation since the original federal securities laws of the 1930s?

34. Which of the following is NOT part of the 11 sections of the SOX Act?

35. The Sarbanes-Oxley Act of 2002 is a piece of legislation created for the purpose of protecting investors from accounting fraud, specifically:

36. What is the purpose of the SOX Act?

37. What is the primary function of SAG (Standing Advisory Group)?

38. How did title IV of the Sarbanes-Oxley Act enhance the reporting requirements for financial transactions?

39. SOX's audit committee provision requires publicly traded corporations to establish procedures for:

40. When does risk assessment lead to more robust testing of all relevant assertions for significant accounts?

41. Which type of evidence cannot be used by Auditors to reduce the extent of their testing?

42. Which services can a Public Accounting Audit Firm perform for the same client?

43. Which group is responsible for reviewing logs in financial systems?

44. As per the SEC, who is qualified to certify each quarterly or annual report of the public companies per Section 302?

45. Under Sarbanes-Oxley, what is the CEO's responsibility in regards to corporate taxes?

46. Which of the following is to be avoided in documenting flowchart in business processes?

47. Which of the following are not relevant for the success of Section 404 Projects?

48. Under Sarbanes-Oxley’s corporate responsibility provision, the Chief Executive Officer and Chief Financial Officer must certify and approve:

49. Which of the Management representations is not part of Financial Statement Assertions?

50. What is the main requirement of SOX Section 404(a)?

51. The high cost of implementing the Sarbanes-Oxley Act has motivated some companies to do which of the following?

52. Which of the following is a feature of Automated Control?

53. Which of the following was established by the Sarbanes-Oxley Act?

54. Along with the IT department who else in a company is responsible for creating a Sarbanes-Oxley compliant system?

55. Which accounting firms are subject to PCAOB annual inspections?

56. What are Internal Controls within business entities also known as?

57. 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?

58. Who can be a chairperson of PCAOB?

59. For how many years can a public accounting firm audit the same client?

60. Which of the following tools has been largely adopted as part of Sarbanes Oxley IT Compliance?

61. 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?

62. Which Act was passed to cut back on multiple regulatory requirements and coincided with the tenth anniversary of SOX?

63. The Sarbanes-Oxley Act applies to which non US companies?

64. Which of the following companies does NOT have to comply with the all of The Sarbanes Oxley Act's regulatory mandates?

65. Which of the following is a Material Weakness leading to Audit Failure?

66. How many SOX titles (sections) have been ammended?

67. Besides the management of a company, who else would be held responsible for non-compliance with the Sarbanes-Oxley's business record keeping provision?

68. How many public accountants can there be on the PCAOB Board?

69. The Dodd-Frank financial reform bill permanently exempts small-companies from which key provision of section 404 of the Sarbanes-Oxley act?

70. Within Sarbanes-Oxley, who is tasked with registering auditors, and defining the specific procedures for compliance audits?

71. Which organization is responsible for the Internal Control Framework as required by SOX?

72. 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?

73. Which section of the Sarbanes-Oxley Act requires senior management to certify the accuracy of data reported in their company’s financial statement?

74. Which of the following is NOT a Form of Certification as per SEC?

75. Which organization created COBIT as a framework for IT Management and Governance?

76. Identify the sub process of a Receivables Business Process.

77. 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?

78. In order to determine significant accounts, Management must consider the concept of Materiality. Which of the following is a Quantitative consideration of Materiality?

79. What is the requirement regarding code of ethics for companies under SOX?

80. What was the main reason behind the act to be drafted?

81. Why are whistleblowers protected under law now?

82. What is the new maximum prison term for executives who impede an official investigation?

83. What is the first step in implementing Sarbanes Oxley compliance?

84. What is COBIT?

85. Commonly used acronym for Sarbanes Oxley Act?

86. What is meant by 'top down' testing?

87. Best way to ensure that the documentation is complete?

88. How can companies accelerate their documentation process?

89. What ban has been placed on directors of a company during a pension fund blackout period?

90. Requirement for procedures and listing all risk factors and mitigating factors?

91. Which high profile company was one of the cornerstones of the financial fraud problems?

92. What is a SAS 70 report?

93. Main goal of the act regarding the public?

94. What is the documentation requirement for off balance sheet transactions?

95. Best method for an auditor to gain an understanding of a company's procedures?

96. What was the original compliance deadline date for companies?

97. What is meant by 'compliance'?

98. What has to be done in the documentation for Section 404?

99. What must a legal firm which learns of a corporate client's illegal activities do under SOX?

100. What would an auditor look for and test on a financial statement?

101. What purpose does performing walkthroughs serve?

102. What is a primary debatable issue regarding the act and its effect on United States based companies compared to other countries?

103. What is testing for 'design effectiveness'?

104. What does an auditor do?

105. What is the disclosure requirement for company management regarding any transactions involving their personal holdings in the company?

106. What does SOX state regarding personal loans from the company to executives?

107. On an average how long does it take to document a procedure?

108. What have some firms looking to avoid the SOX regulations done?

109. Why are risk factors listed in documentation?

110. What are the minimum requirements under section 302 of SOX?

111. How are companies able to manage the documentation process effectively?

112. How do independent auditors test the claims of management?

113. What is one way a company can become non compliant with SOX?

114. What is the annual requirement of a company under SOX?

115. What method may an auditor use to gain confidence in the company's documentation regarding procedures?

116. What was the magnitude of financial losses due to accounting fraud before the act?

117. What is a major criticism of documentation?

118. What is the level of crime when management knowingly signs off on compliance documents it knows to be incorrect and misleading?

119. What must annual reports contain in order to be compliant with section 404?

120. What is COBIT akin to from the Accounting world?

121. What is the general implementation process for SOX in order?

122. What is a whistleblower?

123. What is the PCAOB?

124. Which agency was created because of the act?

125. Who is held responsible at the corporate level once SOX has been signed off by the auditors?

126. What do COBIT standards indicate?

127. Which departments are required to be involved in documentation for SOX?

128. What is corporate fraud?

129. Where did the name Sarbanes Oxley come from?

130. One of the primary, overall objectives of SOX regulations?

131. What is the penalty awarded to senior management for non compliance with SOX?

132. Requirements of section 404 of SOX?

133. What method of documentation is required under SOX?

134. What is the often criticized part of the act?

135. Who issues the COBIT standards?

136. Why is it important to document all of the internal controls of the IT department?

137. What separation would be required between a company and its audit firm?

138. What is the SEC?

139. Which would be classified as an 'issuer' under SOX?

140. What does the board of directors do for a company?

141. What are 'financial disclosures'?

142. Another name for the Sarbanes Oxley Act?

143. What makes for a 'significant deficiency'?

144. What is it meant to be accountable?

145. What service can an audit firm still provide to a corporate client when engaged as auditors?

146. Auditors role in a section 404 audit?

147. What makes for a 'material weakness'?

148. How does an auditor gain confidence about a company's operating effectiveness?

149. Purposes of extensive documentation of accounting records and policies?

150. What is meant by the 'internet bubble'?

151. Question an auditor may ask himself regarding a client's balance sheet?

152. Management's responsibilities with respect to a 404 audit?

153. What is one of the purposes of section 404 of the Sarbanes Oxley act?

154. Most commonly used software for SOX flow chart documentation?

155. What is meant by '404'?

156. Mitigating factors in documentation?

157. Which U.S. President signed the act into effect?

158. Time requirement for auditors to save and retain all audit related records?

159. In which year was the Sarbanes Oxley Act created?