Question

Under the Sarbanes-Oxley Act, when must audit working papers be saved?

A) For one year.

B) For five years.

C) For seven years.

D) Indefinitely.

Answer 1

Audit working papers must be saved for seven years under the Sarbanes-Oxley Act, ensuring compliance and supporting auditors in their work.

Step-by-step explanation:

Under the Sarbanes-Oxley Act, audit working papers must be retained for seven years. This requirement is based on regulations set forth to improve the accuracy and reliability of corporate disclosures and to protect investors from the possibility of fraudulent accounting activities by corporations. The retention of audit working papers for the specified duration is crucial for compliance with the act and also for ensuring that auditors have necessary documentation to support financial audits and reviews.