The Sarbanes-Oxley Act,passed after the fall of Enron and Arthur Andersen,requires accounting firms to separate the auditing function from the consulting function.This example illustrates
A) organizational complexity.
B) how changing conditions are influenced by innovation.
C) why control is necessary to reduce the accumulation of errors.
D) how control helps organizations respond to changing standards.
E) All of these choices

Question

Quizplus · Accepted Answer

The example of the Sarbanes-Oxley Act illustrates how control helps organizations respond to changing standards. The act was passed to address the issues that led to the fall of Enron and Arthur Andersen, which highlighted the need for improved control and accountability in the accounting industry. The act required the separation of auditing and consulting functions to prevent conflicts of interest and improve the quality of audits. This is an example of how control can help organizations adjust to changing conditions and standards.

The Sarbanes-Oxley Act,passed After the Fall of Enron and Arthur