ACP AUDITING - RISK BASED APPROACH
10th Edition
ISBN: 9780357195079
Author: JOHNSTONE
Publisher: CENGAGE C
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Chapter 1, Problem 7TFQ
To determine
Introduction: The Sarbanes-Oxley act is a federal law also known as “Public Company Accounting Reform and Investors Protection Act”. It came into force to protect investors, employees and public from fraudulent financial practices.
To state: If the given statement is true or false.
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Chapter 1 Solutions
ACP AUDITING - RISK BASED APPROACH
Ch. 1 - Prob. 1TFQCh. 1 - Prob. 2TFQCh. 1 - Prob. 3TFQCh. 1 - Prob. 4TFQCh. 1 - Prob. 5TFQCh. 1 - Prob. 6TFQCh. 1 - Prob. 7TFQCh. 1 - Prob. 8TFQCh. 1 - Prob. 9TFQCh. 1 - Prob. 10TFQ
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Sarbanes Oxley Act of 2002. include the achievements, failure, and challenges of SOX2002. A brief note to describe SOX and why it is enacted. Discuss the corporate scandals that occurred before the enactment of SOX Act and how those scandals could have been avoided if SOX was in place. The second phase of your analysis should discuss the corporate scandals occurred after the enactment of SOX Act clearly highlighting why Sox could not act as a deterrent to the scandals. Do you think there are any gaps in the act or the factors that led to the scandal are just beyond the purview of the SOX Act. Challenges before the SOX act as we move forward.arrow_forwardToo Big to Fail - During the recession of 2008, we were introduced to this new term. A large bank or financial institution that engages in illegal activity many are not severely punished or have its officials charged with criminal activity. Why? What is the reason?arrow_forwardWhat provisions in the Dodd-Frank Wall Street Reform andConsumer Protection Act are designed to prevent a futurefinancial crisis?arrow_forward
- Explain monetary and fiscal measures that should be implemented by the government to cool down an overheating economy. Discuss the impacts of these measures on businesses.arrow_forwardIn 2001 and 2002 there were several high-profile US corporate collapses associated with misleading financial statements and accounting practices. Following these collapses, new laws were introduced to improve the quality of financial reporting. a) In your opinion, will further regulation prevent deliberately misleading reporting? Explain. b) Are additional laws likely to prevent corporate collapses? Why or why not? c) How important is the enforcement of financial reporting requirements in promoting high quality reporting?arrow_forward18 - An example of systematic risk is: changes in the Federal budget deficit that could affect interest rates or federal taxation. a fire at a Dow Chemical Corporation factory. the bankruptcy of Pea Pod Corporation. the accidental death of the President and CEO of United Amalgam Corporation. all of the above. none of the above.arrow_forward
- Classify each of the following events as a source of systematic or unsystematic risk with explanations: (i) After the current election, Donald Trump is no more the President of United States of America and Joe Biden is appointed to take over his place. (ii) Harlie Davidson is convicted of insider trading and is sentenced to 10 years of prison. (iii) An OPEC embargo raises the world market price of oil. (iv) A major consumer product, Ribena loses a product liability case due to misleading Vitamin C advertisement. (v) The Supreme Court rules that no employer can layoff an employee without first giving 30-days notice.Classify each of the following events as a source of systematic or unsystematic risk with explanations:arrow_forwardClassify each of the following events as a source of systematic or unsystematic risk with explanations: (i) After the current election, Donald Trump is no more the President of United States of America and Joe Biden is appointed to take over his place. (ii) Harlie Davidson is convicted of insider trading and is sentenced to 10 years of prison. (iii) An OPEC embargo raises the world market price of oil. (iv) A major consumer product, Ribena loses a product liability case due to misleading Vitamin C advertisement. (v) The Supreme Court rules that no employer can layoff an employee without first giving 30-days notice.arrow_forwardSystematic risk evaluates the probability and extent of negative consequences to the larger body. For example, the government has a record of intervening in the event of a probable bank failure; the government’s larger concern is the negative impact on bank customers. Some call this a government bailout. Research a recent government bailout and explain why the government felt it was necessary. What risks do you think the government had to consider in making its decision?arrow_forward
- During the early 2000s, the role of accounting and the auditing profession in the United States changed due to the discovery of several impactful accounting scandals. Using the Strayer Library, research the economic climate surrounding two accounting scandals. What conditions caused accounting and the auditing profession's role to change during this time? What major changes occurred as a result of the accounting scandals?arrow_forward6-12: Policy Issues Relating to General Long-Term Debt. A citizens’ group in your state has placed an amendment on an upcoming election ballot. The measure would prohibit new debt issuances by state or local governments, which would presumably reduce taxes as a result of less tax-supported debt. Supporters of the amendment claim the proposed measure will force government to operate more efficiently and cut bloated spending, while opponents fear that public services and the quality of life inthe state will be severely affected if the amendment passes. Required:a. Why do governments typically issue general long-term debt? What types of services might be limited if debt was no longer a financing option? b. Consider each of the following statements regarding the amendment. Select at least one of the statements (numbered 1–4) to indicate your position on the proposed amendment. Incorporating the statement(s) selected, draft a memo supporting your position on the proposed amendment. (1).…arrow_forwardCan anyone help? The Sarbanes-Oxley Act is a product of a series of scandals that took place around the turn of the millennium. A) Has Sarbanes-Oxley really done anything to curb fraud? B) How does the Sarbanes-Oxley Act affect U.S. companies as they compete globally?arrow_forward
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