Question

Section 404 of Title IV of Sarbanes-Oxley requires managers to attest to the adequacy of their ______________ _____________.

a) Financial disclosures.
b) Employee training programs.
c) Marketing strategies.
d) Internal control over financial reporting.

Answer 1

Section 404 of the Sarbanes-Oxley Act mandates that managers must attest to the adequacy of their internal controls over financial reporting, aiming to improve investor confidence and prevent accounting fraud. option (A)

Step-by-step explanation:

Section 404 of Title IV of the Sarbanes-Oxley Act requires managers to attest to the adequacy of their internal control over financial reporting. The intention behind this provision is to bolster the reliability of financial disclosures following a series of accounting scandals involving major corporations like Enron and WorldCom.

Adequate internal controls are essential for preventing fraud and instilling investor confidence. This requirement is a testament to the government's resolve to protect investors and improve corporate governance after witnessing the repercussions of lax oversight.