Question

Under the Sarbanes-Oxley Act of 2002, the audit committee of a public company has the what equirements?

Answer 1

The Sarbanes-Oxley Act of 2002 introduced requirements for the audit committee of a public company.

Step-by-step explanation:

The Sarbanes-Oxley Act of 2002 introduced certain requirements for the audit committee of a public company. These requirements are aimed at ensuring the independence and effectiveness of the audit committee in overseeing the company's financial reporting and internal control systems.

Some of the key requirements for the audit committee under Sarbanes-Oxley include:

1. Independence: All members of the audit committee must be independent of the company and its management. They should not have any financial or personal relationships that could compromise their objectivity.
2. Financial Expertise: At least one member of the audit committee should have financial expertise, which can include accounting or auditing experience or qualifications.
3. Maintaining Financial Reporting Integrity: The audit committee should oversee the company's financial reporting process to ensure the integrity of the financial statements.
4. Selection and Oversight of External Auditors: The audit committee is responsible for selecting and overseeing the external auditors and approving their compensation. They should ensure the independence and effectiveness of the auditors.
5. Internal Controls: The audit committee is responsible for overseeing the effectiveness of the company's internal control systems.