Sarbanes Oxley Act: SOX Corporate Governance

Instructions:

• Answer 50 questions in 15 minutes.
• If you are not ready to take this test, you can study here.
• Match each statement with the correct term.
• Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. Employees of a corporation who are appointed by the board of directors to manage the day-to-day operations of the corporation
officer
record date
quorum
board of directors


2. Under what conditions may an employee claim protection of SOX?
Make a complaint to specific groups or people about certain types of misconduct - Participate in certain types of proceedings relating to shareholding misconduct
SEC - PCAOB - FASB - IASB - AICPA - CPA - IFRS - GAAP - GAO - CRARA - PSLRA - FINRA - FCPA - OSHA - ERISA - FSG
Providing information about conduct he or she reasonably believes violates the federal laws - SEC regulations - or federal laws against shareholder fraud
If they provide information to be provided to - or assists in an investigation conducted by: A federal regulatory or law enforcement agency (such as the SEC) - A member of committee of Congress - A person who either has supervisory authority over the


3. A system in which a shareholder can accumulate all of his or her votes and vote them all for one candidate or split them among several candidates
supramajority voting requirement
Applies only to companies whose stock is traded on public exchanges. Its purpose is to restore public confidence and trust in the financial statements of companies.
duty of loyalty
cumulative voting


4. To be protected by sox an employee must do one of what activities?
The requirement that public companies create procedures for anonymous employee complaints is enforced by the SEC. The SEC has issued rules requiring the national securities exchanges and associations to delist the stock of companies that fail to comp
Make a complaint to specific groups or people about certain types of misconduct - Participate in certain types of proceedings relating to shareholding misconduct
stock dividend
record date


5. What about an employee whose complaint is based on a feeling or hunch - in the absence of any evidence?
termination - demotion - suspension - threats - harassment
duty of obedience
They are not protected
Receiving - keeping - and handling complaints the company receives regarding its accounting - auditing - or internal accounting controls Allowing employees to submit confidential - anonymous complaints and concerns about questionable accounting or


6. Bank statement
Allows a business to reconcile the cash transactions recorded
Sarbanes-Oxley Act
Applies only to companies whose stock is traded on public exchanges. Its purpose is to restore public confidence and trust in the financial statements of companies.
Assets are Safeguarded and used for business purposes - Business information is Accurate - Employees comply with Laws and Regulations


7. Sox important Organizations that you must know
stock dividend
15
SEC - PCAOB - FASB - IASB - AICPA - CPA - IFRS - GAAP - GAO - CRARA - PSLRA - FINRA - FCPA - OSHA - ERISA - FSG
Any officer - contractor - subcontractor - agent - or employee of a company


8. What is required to qualify as a protected whistleblower
The employee engaged in protected activity - The person accused of retaliation knew of the activity - The employee suffered an adverse employment action - The circumstances create an inference that the adverse employment action was due to the employe
cumulative voting
30
personal liability


9. An agreement that requires selling shareholders to sell their shares to the other shareholders or to the corporation at the price specified in the agreement
Sarbanes-Oxley Act
buy-and-sell agreement
duty of care
special shareholders' meetings


10. The SEC regulations to not require companies to follow what?
interference with employment or livelihood of the informant
The SEC regulations do not require companies to follow particular procedures for taking employee complaints (such as setting up an ethics hotline or a Web-based complaint system)
preemptive rights
SEC - PCAOB - FASB - IASB - AICPA - CPA - IFRS - GAAP - GAO - CRARA - PSLRA - FINRA - FCPA - OSHA - ERISA - FSG


11. What is the stated purpose of SOX?
To protect investors by improving the accuracy and reliability of corporate disclosures - and much of the law seeks to further this goal by imposing strict rules for audits and auditors of publicly traded companies - preventing insider trading and de
administrative law judge - decision - order
proxy
They can have their stocks delisted by the national securities exchange and associations


12. The criminal provision could apply to anyone who ____________ - whether or not the perpetrator works for or has any association with a public company
record date
retaliates against a whistleblower
supramajority voting requirement
all employees who work for public companies as long as they qualify as a whistleblower


13. What is one of the most important controls to protect cash received in over-the-counter sales?
Any document that serves as proof of authority to pay cash or issue an electronic funds transfer.
Cash Register
retaliates against a whistleblower
Sarbanes-Oxley Act


14. A system in which each shareholder votes the number of share he or she own on candidates for each of the positions open - also called noncumulative voting
The employee must also serve this notice on the other parties to the dispute (the employer and any other companies or individuals whom the employee accuses of retaliation)
The SEC regulations do not require companies to follow particular procedures for taking employee complaints (such as setting up an ethics hotline or a Web-based complaint system)
record date
straight voting


15. Either party may object to these findings and request a hearing within __ days after receiving the finding and order.
shareholder voting agreement
business judgment rule
duty of obedience
30


16. A meeting of the shareholders of a corporation that must be held by the corporation to elect directors and to vote on other matters

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


17. Public company
administrative law judge - decision - order
Any company that has a class of securities registered with the Securities and Exchange Commission (SEC) under 15 U.S.C.
fiduciary duties
annual shareholders' meeting


18. A duty of corporate directors and officers to use care and diligence when acting on behalf of the corporation
The person or company must present it's evidence within 20 days after it receives the complaint
review
personal liability
duty of care


19. Internal Complaint Procedures
supramajority voting requirement
stock dividend
personal liability
The requirement that public companies create procedures for anonymous employee complaints is enforced by the SEC. The SEC has issued rules requiring the national securities exchanges and associations to delist the stock of companies that fail to comp


20. The employee is required to do what relative to protected whistleblowers?

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


21. Bank reconcilation
interference with employment or livelihood of the informant
Managers and supervisors who violate SOX by retaliating against whistle blowers may be held personally liable and have to pay judgment awarded to the employee
Analysis of the items and amounts that cause the cash balance reported in the bank statement to differ from the balance of the cash account in the ledger in order to determine the adjusted cash balance.
Sarbanes-Oxley Act


22. A lawsuit a shareholder brings against an offending party on behalf of a corporation when the corporation fails to bring the lawsuit
15
Help control cash by reduicng the amount of cash on hand and facilitating the transfer of cash between businesses and locations
negligence
derivative lawsuit


23. Example of whistle blowing activities that DOL has found to be covered under SOX.
petition - Administrative Review Board - 10
Any company that has a class of securities registered with the Securities and Exchange Commission (SEC) under 15 U.S.C.
15
Providing information about conduct he or she reasonably believes violates the federal laws - SEC regulations - or federal laws against shareholder fraud


24. Meetings of a shareholders that may be called to consider and vote on important or emergency issues - such as a proposed merger or amending the articles of incorporation

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


25. Usurping of corporate opportunity

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


26. Either party may request a review of the judge's decision by filing a __ with the __ within __ days after the date on the judge's order
Any document that serves as proof of authority to pay cash or issue an electronic funds transfer.
petition - Administrative Review Board - 10
Analysis of the items and amounts that cause the cash balance reported in the bank statement to differ from the balance of the cash account in the ledger in order to determine the adjusted cash balance.
SEC - PCAOB - FASB - IASB - AICPA - CPA - IFRS - GAAP - GAO - CRARA - PSLRA - FINRA - FCPA - OSHA - ERISA - FSG


27. An agreement between two or more shareholders that stipulates how they will vote their shares
Sarbanes-Oxley Act
Investigations - Legal proceedings
They are not protected
shareholder voting agreement


28. Bank accounts
An employee who wishes to bring a lawsuit claiming that he or she was discriminated or retaliated against in violation of SOX's whistleblower protections must first file a complaint with the Occupational Safety and Health Administration (OSHA) within
The employee only needed to show that he or she had a reasonable belief that the conduct constituted fraud
dividend
Help control cash by reduicng the amount of cash on hand and facilitating the transfer of cash between businesses and locations


29. Bank reconcilation steps
The employee can file a lawsuit in federal district court
Receiving - keeping - and handling complaints the company receives regarding its accounting - auditing - or internal accounting controls Allowing employees to submit confidential - anonymous complaints and concerns about questionable accounting or
shareholder voting agreement
Cash balance according to bank statement - Add deposit not recorded by bank (outstanding deposit) - Deduct outstanding checks (+/- Errors) - Adjusted Balance - Cash balance according to company - Add note and interest collected by bank - Deduct servi


30. Objectives of Internal Control
Control environment - Risk assessment - Control procedures - Monitoring - Information and communication
Assets are Safeguarded and used for business purposes - Business information is Accurate - Employees comply with Laws and Regulations
Set of procedures for authorizing and recording liabilities and cash payments. It may be either manual or computerized.
Any document that serves as proof of authority to pay cash or issue an electronic funds transfer.


31. An arrangement in which the shareholders transfer their stock certificates to a trustee who is empowered to vote the shares
officer
Any officer - contractor - subcontractor - agent - or employee of a company
voting trust
The employee engaged in protected activity - The person accused of retaliation knew of the activity - The employee suffered an adverse employment action - The circumstances create an inference that the adverse employment action was due to the employe


32. What new employee right was created by SOX?
Creates employee whistleblower protections: Employees who complain of - or provide information about - actions they believe to be shareholder fraud are protected from discrimination and retaliation. The law also obligates covered companies to create
officer
interference with employment or livelihood of the informant
Make a complaint to specific groups or people about certain types of misconduct - Participate in certain types of proceedings relating to shareholding misconduct


33. If OSHA investigates - it will issue findings and a preliminary order within __ days after the complaint is filed.
opportunity was presented to the director/officer in his or her corporate capacity - opportunity is related to or connected with teh corporation's current or propsed business - corporation has the financial ability to take advantage of the opportunit
60
business judgment rule
The financial safeguards imposed by SOX include numerous reporting requirements - but there are no reporting requirements associated solely with its whistleblower provisions - The National securities exchanges and commissions may require public compa


34. Voucher
Any document that serves as proof of authority to pay cash or issue an electronic funds transfer.
SEC - PCAOB - FASB - IASB - AICPA - CPA - IFRS - GAAP - GAO - CRARA - PSLRA - FINRA - FCPA - OSHA - ERISA - FSG
right of first refusal
A committee of members of the board of directors of a public company - formed to oversee the company's audits and accounting and financial reporting processes. Has a number of legal obligations under SOX. If a public company does not establish a sepa


35. A doctrine that says if a shareholder dominates a corporation and uses it for improper purposes - a court of equity can disregard the corporate entity and hold the shareholder personally liable for the corporation's debts and obligations - also calle
buy-and-sell agreement
The employee can file a lawsuit in federal district court
derivative lawsuit
piercing the corporate veil


36. Why did Congress pass SOX?
15
retaliates against a whistleblower
In the wake of corporate scandals involving WorldCom - Enron - and other large companies accused of defrauding shareholders
Applies only to companies whose stock is traded on public exchanges. Its purpose is to restore public confidence and trust in the financial statements of companies.


37. 'The employee's claim of shareholder fraud does not have to be correct.'
Managers and supervisors who violate SOX by retaliating against whistle blowers may be held personally liable and have to pay judgment awarded to the employee
They can have their stocks delisted by the national securities exchange and associations
review
The employee only needed to show that he or she had a reasonable belief that the conduct constituted fraud


38. SOX creates __ for company representatives.
Reinstate the worker to the same position - with the same benefits - responsibilities - and seniority - that the worker would have had absent the retaliation - Pay worker all the compensation and benefits lost as a result of the retaliation with inte
personal liability
Cash Register
review


39. SOC record keeping requirements
derivative lawsuit
terms - conditions
The financial safeguards imposed by SOX include numerous reporting requirements - but there are no reporting requirements associated solely with its whistleblower provisions - The National securities exchanges and commissions may require public compa
right of first refusal


40. Even if the employee provides evidence of individual complaints - OSHA will not investigate under what condition?
If the company or person named can show by clear and convincing evidence that it would have taken the same action against the employee even in the absence of the employees protected activity
annual shareholders' meeting
shareholder voting agreement
Any company that has a class of securities registered with the Securities and Exchange Commission (SEC) under 15 U.S.C.


41. Public companies and company representatives are not permitted to retaliate against an employee in the __ or __ of his/her employment because the employee provided information - participated in an investigation - or participated in a proceeding relat
public companies
Any company that has a class of securities registered with the Securities and Exchange Commission (SEC) under 15 U.S.C.
Employees who complain of violations of state law - or those who complain of violations of internal company policies or procedures (unless the violation could also mislead shareholders)
terms - conditions


42. SOX deadlines

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


43. A requirement that a greater than majority of shares constitutes a quorum of the vote of the shareholders
board of directors
20
supramajority voting requirement
Petty Cash Fund or travel funds are used by businesses to meet specific needs. Cashing a check for the amount of cash needed


44. SOX generally only applies to __ - however - it's whistleblower provision also applies to company representatives.
Petty Cash Fund or travel funds are used by businesses to meet specific needs. Cashing a check for the amount of cash needed
public companies
petition - Administrative Review Board - 10
piercing the corporate veil


45. Elements of Internal Control
The person or company must present it's evidence within 20 days after it receives the complaint
Control environment - Risk assessment - Control procedures - Monitoring - Information and communication
There is no avenue for employee complains regarding a public company's failure to adopt an appropriate system for confidential employee complaints. This provision is enforced by the SEC only.
30


46. The number of directors necessary to hold a board meeting or transact business of the board
quorum
Cash balance according to bank statement - Add deposit not recorded by bank (outstanding deposit) - Deduct outstanding checks (+/- Errors) - Adjusted Balance - Cash balance according to company - Add note and interest collected by bank - Deduct servi
Investigations - Legal proceedings
To protect investors by improving the accuracy and reliability of corporate disclosures - and much of the law seeks to further this goal by imposing strict rules for audits and auditors of publicly traded companies - preventing insider trading and de


47. A member of a board of directors who is not an officer of the corporation
shareholder voting agreement
quorum
outside director
Receiving - keeping - and handling complaints the company receives regarding its accounting - auditing - or internal accounting controls Allowing employees to submit confidential - anonymous complaints and concerns about questionable accounting or


48. A rule that says directors and officers are not liable to the corporation or its shareholders for honest mistakes of judgment
The requirement that public companies create procedures for anonymous employee complaints is enforced by the SEC. The SEC has issued rules requiring the national securities exchanges and associations to delist the stock of companies that fail to comp
proxy
business judgment rule
terms - conditions


49. A duty that directors and officers of a corporation have to act within the authority conferred upon them by state corporation codes - the articles of incorporation - the corporate bylaws - and the resolutions adopted by the board of directors
Managers and supervisors who violate SOX by retaliating against whistle blowers may be held personally liable and have to pay judgment awarded to the employee
A committee of members of the board of directors of a public company - formed to oversee the company's audits and accounting and financial reporting processes. Has a number of legal obligations under SOX. If a public company does not establish a sepa
duty of obedience
Employees who complain of violations of state law - or those who complain of violations of internal company policies or procedures (unless the violation could also mislead shareholders)


50. The company or person must present evidence within __ days after receiving notice of the complaint.
Make a complaint to specific groups or people about certain types of misconduct - Participate in certain types of proceedings relating to shareholding misconduct
Employees who complain of violations of state law - or those who complain of violations of internal company policies or procedures (unless the violation could also mislead shareholders)
20
fiduciary duties