The supplementary document/resource titled “SOX Act 101-Key Components”, references eight key implementation components of the SOX Act. Given what you know about why the Act was established in 2002, explain which of those eight sections you feel was most necessary in the effort to discourage fraudulent activities by organizations. Additionally, explain which is your favorite section.
In: Accounting
The Sarbanes-Oxley Act (SOX) was passed in 2002. The legislation was intended to prevent accounting fraud. What did offending companies do to cause legislators to get involved in the situation? What safeguards were put in place by SOX? In your opinion, will SOX prevent accounting fraud? Why or why not? In your opinion, should legislators put further safeguards in place? Why or why not?
In: Accounting
On June 4, 2002, Fred bought stock at a cost of $8,000. On January 30, 2019, he gave the stock to his son, George. At the time of the gift, the fair market value of the stock was $6,500. On May 1, 2019, George sold the stock.
State whether there is a short-term or long-term capital gain or loss, and the amount of the gain or loss, if the stock was sold at $7,000.
In: Accounting
The function
D(t) = 43.1224(1.0475)^t. gives the number of master’s degrees, in
thousands, conferred on women in the United States t years after
1960. Find the number of master’s degrees earned by women in 1984,
in 2002, and in 2010. Then estimate the number of master’s degrees
that will be earned by women in 2020.?When will the number of
master’s degrees earned by women in the U.S. reach a million?
In: Math
In what major ERP module would budgeting be handled?
(2pts)
Controlling and profitability analysis module
Sales and distribution module
Financial accounting module
Supplier relationship managment module
All of the above
None of the above
66)
Most directly, characters comprise _____.
(2pts)
tables
attributes
tuples
records
None of the above
67)
Which of the following controls restrict access to programs, data, and documentation?
(2pts)
program change controls
library controls
authentication controls
password controls
All of the above
None of the above
68)
Which category of management objectives within the ERM framework addresses the efficient and effective use of resources?
(2pts)
reporting
operations
compliance
strategic
All of the above
None of the above
69)
The need to ensure that an organization's accounting information system is able to produce financial data in a timely and accurate manner relates most directly to the mandate of _____.
(2pts)
Section 409 of the Sarbanes-Oxley Act of 2002
Section 404 of the Sarbanes-Oxley Act of 2002
Internal Revenue Code of 1986
The Securities and Exchange Act of 1934
In: Finance
Assume that you will buy stock on margin (i.e.; stock margin trading). Assume that Texas Instruments Corp stock is currently selling for $50 per share. Assume that you will purchase 500 shares on July 29, 2002 at 11:00 AM. You have $15,000 of your own to invest and you will borrow an additional $10,000 from your broker at an interest rate of 10% per year. Assume that the Maintenance Margin is 40%.
17) Which of the following presents the balance sheet if the stock price increases to $100 per share July 29, 2002 at 11:01 AM. In other words, which of the following presents the balance sheet using this information.
a. ASSETS LIAB & OWN EQUITY
Stock $50,000 Liab $10,000
Equity $40,000
b. ASSETS LIAB & OWN EQUITY
Stock $25,000 Liab $10,000
Equity $15,000
c. ASSETS LIAB & OWN EQUITY
Stock $50,000 Liab $11,000
Equity $39,000
d. ASSETS LIAB & OWN EQUITY
Stock $50,000 Liab $20,000
Equity $ 30,000
e. none of the above
In: Accounting
In 2002, the audit frm Arthur Andersen collapsed following charges brought against it in the United
States relating to the failure of its client, Enron. Some other clients announced that they would be
dismissing Arthur Andersen as their auditor even before it was clear that Arthur Andersen would not
survive.
Required
Using the theories outlined in this chapter on the demand for audits, explain some reasons why these
clients took this action.
In: Accounting
The management of Mitchell Labs decided to go private in 2002 by buying all 3.50 million of its outstanding shares at $25.50 per share. By 2006, management had restructured the company by selling off the petroleum research division for $14.75 million, the fiber technology division for $7.50 million, and the synthetic products division for $23 million. Because these divisions had been only marginally profitable, Mitchell Labs is a stronger company after the restructuring. Mitchell is now able to concentrate exclusively on contract research and will generate earnings per share of $1.20 this year. Investment bankers have contacted the firm and indicated that if it reentered the public market, the 3.50 million shares it purchased to go private could now be reissued to the public at a P/E ratio of 14 times earnings per share.
a. What was the initial cost to Mitchell Labs to
go private? (Do not round intermediate calculations. Round
your answer to 2 decimal places. Enter your answer in millions, not
dollars (e.g., $1,230,000 should be entered as "1.23").)
b. What is the total value to the company from
(1) the proceeds of the divisions that were sold, as well as (2)
the current value of the 3.50 million shares (based on current
earnings and an anticipated P/E of 14)? (Do not round
intermediate calculations. Round your answer to 2 decimal places.
Enter your answer in millions, not dollars (e.g., $1,230,000 should
be entered as "1.23").)
c. What is the percentage return to the
management of Mitchell Labs from the restructuring? Use answers
from parts a and b to determine this value.
(Do not round intermediate calculations. Enter your answer
as a percent rounded to 2 decimal places.)
In: Finance
Under Section 404 of the Sarbanes-Oxley Act of 2002, what is the independent auditor's responsibility?
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The independent auditor is required to report on and attest to management's assessment of the effectiveness of the internal controls. |
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The independent auditor is required to establish and maintain an adequate internal control structure and procedures for financial reporting. |
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The independent auditor is required to disclose which member of the audit committee is a financial expert. |
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The independent auditor is required to provide certifications with each annual and quarterly report filed with the SEC. |
In: Accounting
According to the Sarbanes-Oxley Act of 2002, management is responsible for establishing a control environment, assessing risks it wishes to control, specifying information and communication channels and content (including the accounting system and its reports), designing and implementing control procedures, and monitoring, supervising, and maintaining the controls.
As Internal/Forensic Auditor, I made multiple recommendations to management relative to eliminating inefficiencies in the business process. Some of my recommendations were ignored and the inefficiencies were allowed to continue. Management felt the risk exposure related to the inefficiencies was not significant.
Considering this, do you believe management should be free to make their own judgments about the necessary extent of controls?
In: Accounting