Question

discuss what gaap and sarbanes-Oxley is?

Answer 1

GAAP of Generally accepted accounting principals is the accepted method for accountancy with guidance and instructions for how individual transactions should be reported in financial statements. The GAAP principals work in accordance with the U.S Financial accounting standards board while compiling financial statements.

Sarbanes Oxley Act known as SOX is a bill passed by Congress in 2002, as a measure to improve transparency in financial accounting and fraud. SOX consists of 11 chapters that establish wide-ranging new regulations for auditors, CEOs, the board of directors, investment banks and investment analysis. The chapters ensure that company that performs audits are sufficiently independent of the company they are auditing for, a key executive certifying the accuracy and completeness of the financial statements, board of directors audit committee is relatively independent of management, financial analysts are independent of the companies they analyze and companies promptly release all important information about their financial condition.