Answer
Key provisions of the Sarbanes-Oxley Act include:
.The act establishes an oversight authority for accounting practices. - The Public Company Accounting Oversight Board (PCAOB) is charged with enforcement and oversight authority as well as establishing auditing, independence standards, quality control, and rules.
.The act also enacts stronger independence for auditors. - Audit partners, for instance, are required to be subjected to the rotation after every five years as well as prohibitory measures from providing certain types of consulting services to corporates.
.The act also requires CFOs and CEOs to personally certify that financial reports and statements are complete and accurate. In this, they are also required to forfeit profits and bonuses where an accounting restatement is made.
.The act also calls for audit committees to include members with financial expertise and independent members.
.The act also calls for a code of ethics for chief financial officers.
Work Step by Step
Moreover, Sec. 404 of the Sarbanes Oxley Act requires all public companies to attest to the effectiveness of their internal controls over financial reporting.
