Companies are required to set up confidential systems so that employees can "raise red flags" about suspected illegal or unethical accounting practices.

Question

Companies are required to set up confidential systems so that employees can "raise red flags" about suspected illegal or unethical accounting practices.​

Quizplus · Accepted Answer

This statement is true. It is a requirement under the Sarbanes-Oxley Act of 2002 which aims to improve corporate accountability and prevent financial fraud. Companies must establish a confidential reporting system for employees to report suspected illegal or unethical behavior related to accounting practices without fear of retaliation.

Companies Are Required to Set Up Confidential Systems So That