Question

Distinguish between the two subsections of Section 404 of the Sarbanes-Oxley Act of 2002.

Answer 1

Section 404 of the Sarbanes-Oxley Act of 2002 contains two subsections. Subsection 404(a) requires management to assess and report on internal control, while subsection 404(b) requires external auditors to review and attest to management's assessment.

Step-by-step explanation:

Sarbanes-Oxley Act of 2002, a legislative response to accounting scandals, contains two subsections in Section 404. The first subsection, 404(a), requires management of public corporations to assess and report on the effectiveness of their internal control over financial reporting. The second subsection, 404(b), mandates that external auditors review and attest to management's assessment.