Discuss the three matters which Sarbanes-Oxley requires auditors of public companies to report to the audit committee?
Response is 450 words plus references.
Let me first start by reminding you that the Sarbanes Oxley Act was created in 2002 with a view to to enact a new set of enhanced accounting standards for all U.S. public company boards, management and public accounting firms. It was established mainly because of a host of corporate accounting scandals which rocked the USA and caused investors to lose millions of dollars. One such major scandal was that of Enron. Under the Sarbanes Oxley Act there are numerous sections, but one section worth mentioning here is section 204 which speaks to "Audit Reports to Audit Committees."
The Audit Committee of most public firms usually oversee the accounting and financial reporting processes of the Company and the audits of the financial statements ...
This solution first provides you with an overview of what the Sarbanes Oxley Act is and why it was established. It also tells what are the main functions of the Audit Committee, before discussing three matters that auditors are required to report to the Audit Committee. References are also provided.