Final answer:
It is true that the audit committee is responsible for the appointment, compensation, and oversight of the work of any accounting firm hired by a public company, playing a crucial role in corporate governance.
Step-by-step explanation:
The statement that the audit committee is directly responsible for the appointment, compensation, and oversight of the work of any accounting firm employed by a public company is true. The audit committee, which is a subset of the board of directors, has this responsibility as part of the overall corporate governance framework. Audit committees play a critical role in ensuring the integrity of financial reporting and are required to be composed of independent members of the board, often with financial expertise.
The board of directors is elected by the shareholders and is the first line of corporate governance and oversight for top executives. They are tasked with ensuring that the company runs in the interests of the shareholders. Alongside auditors and large outside investors, the board is a pillar of corporate governance. However, history has shown, such as in the case of Lehman Brothers, that governance can fail and not provide accurate information to investors.