Final answer:
The Sarbanes-Oxley Act of 2002 (SOX) is the legislation that requires company CEOs and CFOs to assume responsibility for their company's financial statements and disclosures to protect investors and improve the reliability of financial reporting.
Step-by-step explanation:
The correct answer to which of the following requires the company's CEO and CFO to assume responsibility for the company's financial statements and disclosures is C. Sarbanes-Oxley Act of 2002 (SOX). The Sarbanes-Oxley Act was enacted in response to major accounting scandals involving corporations such as Enron, Tyco International, and WorldCom. These scandals resulted in the loss of billions of dollars for investors when the share prices of the affected companies collapsed.
The Sarbanes-Oxley Act bolsters corporate governance and enhances the accuracy of corporate financial statements. It requires CEOs and CFOs to personally certify the correctness of their company's financial disclosures, seeking to protect investors by improving the reliability of financial reporting. The Act came about because previous mechanisms of corporate governance, such as the board of directors, auditing firms, and outside investors, like mutual funds and pension funds, failed in some cases to prevent the dissemination of inaccurate financial information to the public, as seen with Lehman Brothers.