Question

The Sarbanes-Oxley Act caused corporate governance of MNCs to _________; it makes executives ____ accountable for verifying financial statements.

a) Become less stringent; less
b) Remain unchanged; less
c) Become more stringent; more
d) Remain unchanged; more

Answer 1

The Sarbanes-Oxley Act, enacted to protect investors from accounting fraud, made corporate governance of MNCs more stringent and increased executives' accountability for financial statements.

Step-by-step explanation:

The Sarbanes-Oxley Act resulted from several major accounting scandals involving corporations such as Enron and WorldCom. In response, the government sought to protect investors and restore confidence in financial reporting. Consequently, the Sarbanes-Oxley Act caused corporate governance of MNCs to become more stringent; it makes executives more accountable for verifying financial statements. Therefore, the correct answer to the question is (c) Become more stringent; more.

Answer 2

The Sarbanes-Oxley Act caused corporate governance of MNCs to Become more stringent; it makes executives more accountable for verifying financial statements. Option C.

Step-by-step explanation:

The Sarbanes-Oxley Act of 2002 is a federal law that was enacted in response to major accounting scandals to increase confidence in the financial information provided by public corporations and protect investors from fraud.

Lawmakers created the legislation to help protect shareholders, employees, and the public from accounting errors and fraudulent financial practices.

Therefore, the appropriate choice is option (C) to Become more stringent; more.