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How can the provisions of the Sarbanes-Oxley Act help minimize the likelihood of auditors failing to identify accounting irregularities?
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∙ 14y ago
The Sarbanes-Oxley Act of 2002 is considered to be the most important change to federal securities laws in the United States since the New Deal. It came in the wake of a series of corporate financial scandals, including those affecting Enron, Arthur Andersen, and WorldCom. Among the major provisions of the act are: criminal and civil penalties for securities violations, auditor independence, certification of internal audit work by external auditors, and increased disclosure regarding executive compensation, insider trading and financial statements.
While unquestionably useful to the investing public, thousands of companies now face the daunting task of ensuring their operations are Sarbanes-Oxley compliant. Auditing departments typically turn to a two pronged solution to achieve this goal. First, firms initiate a comprehensive external audit of the company by Sarbanes-Oxley compliance consultants to identify areas of risk. Second, firms initiate a company-wide installation of automated software systems that provide the security and electronic paper trails necessary to guarantee compliance on a long term operational basis.
Perhaps the most controversial aspects of Sarbanes-Oxley Act are the change from industry self-promulgation and self-enforcement of standards relating to auditing, accounting, quality control, ethics, and independence, to, in effect, government regulation and promulgation of standards through the Public Company Accounting Oversight Board, and the limitations on the nonaudit services a company can provide to its audit clients. Although the Public Company Accounting Oversight Board is not directly empowered to establish accounting standards, Sarbanes-Oxley Act section 108 allows the SEC to recognize "generally accepted" accounting standards set by private entities.
Sarbanes-Oxley Act established the Public Company Accounting Oversight Board, under Securities and Exchange Commission oversight, to be
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∙ 14y ago
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What is management accounting information used for?
Management accounting or managerial accounting is concerned with the provisions and use of accounting information to managers within organizations, ...
What is provisions entry and why do the same entry on closing year?
At the end of accounting year, an enterprise is required to prepare financials (i.e. Cash Flow Statement, Profit and loss account and Balance Sheet).Provisions are to be made for certain liabilities like sales tax, Interest on loan etc. (Those which are ascertainable today, while closing a year) but need to pay in near future (next accounting year). These accounting expenses needs to be considered while making provisions and that's why provisions are made. Provisions are made at the time closing a particular year because expenses relating to coming (next) accounting year can't be booked as expense in current books. This is why provisions are made at end of every accounting year.
What is the Treatment of provisions in financial statements?
Provisions are to be shown in the Liability side of Balance sheet in financial statements. Provisions are made for the expenses which will efford by an enterprise and does not pertains to current accounting year.
What has the author Barry M Johnson written?
Barry M. Johnson has written: 'Accounting provisions of the Companies Act 1985' -- subject(s): Accounting, Corporation law, Disclosure in accounting, Financial statements, Great Britain, Standards
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Its not easy match it with the bad debts and the discount allowed if there are provisions made during the period that relate to the period under review.
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"Provisions" is use to talk about food when you go buy it or "faire des provisions" is make stocks
