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Summarize the following sections of the Sarbanes-Oxley Act o

Summarize the following sections of the Sarbanes-Oxley Act of 2002 and explain their impact on auditing.

SEC. 302. CORPORATE RESPONSIBILITY FOR FINANCIAL REPORTS.
SEC. 404. MANAGEMENT ASSESSMENT OF INTERNAL CONTROLS.
SEC. 406. CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS.
SEC. 409. REAL TIME ISSUER DISCLOSURES.

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SEC. 302. CORPORATE RESPONSIBILITY FOR FINANCIAL REPORTS.

This section is one of the most, if not the most integral sections of the SOX Act. This section is one of the main reasons why SOX was designed. Section 302 requires that the company's CFO and CEO both sign an affidavit stating that they are personally aware and accountable for the information being reported in the company's financial statements. The CEO and CFO can no longer claim ignorance regarding their company's financial health. All CEOs and CFOs of publicly traded companies must abide by this, and must file their affidavit with the company's SEC filings. This impacted auditing because the executives can now be held personally accountable. During Enron and WorldCom, we heard how the CEO and other executives "weren't aware" of what was and what was not being disclosed in the company's financial statements. This section prevents this from happening again.

SEC. 404. MANAGEMENT ASSESSMENT OF INTERNAL CONTROLS.

This section requires that management submit statements to ...

Solution Summary

Summarize the following sections of the Sarbanes-Oxley Act of 2002 and explain their impact on auditing.

SEC. 302. CORPORATE RESPONSIBILITY FOR FINANCIAL REPORTS.
SEC. 404. MANAGEMENT ASSESSMENT OF INTERNAL CONTROLS.
SEC. 406. CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS.
SEC. 409. REAL TIME ISSUER DISCLOSURES.

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