The requirement to report on internal control placed on public companies resulted from one particular type of internal control breakdown: front line employees of some major public companies overrode their control systems and issued misleading financial statements.

Question

Quizplus · Accepted Answer

The requirement to report on internal control for public companies resulted from broader issues of financial misreporting and corporate scandals, such as those involving Enron and WorldCom, which were not solely due to front line employees overriding controls.

The Requirement to Report on Internal Control Placed on Public