The Sarbanes Oxley Act of 2002:
A) prohibits CPA's from becoming managerial accountants.
B) created Generally Accepted Accounting principles (GAAP).
C) requires the CEO and CFO to defer responsibility for internal controls to external auditors.
D) requires management to establish a whistleblower policy.

Question

Quizplus · Accepted Answer

The Sarbanes Oxley Act of 2002 requires companies to establish internal controls and a whistleblower policy, which allows employees to report any illegal or unethical behavior within the company without fear of retaliation. This is in response to several high-profile corporate scandals in which whistleblowers were punished for speaking out. The act does not prohibit CPA's from becoming managerial accountants, create GAAP, or require the CEO and CFO to defer responsibility for internal controls to external auditors.