Quiz 1: Introduction to the Problem of Fictitious Financial Reporting
Fraud Fraud refers to an illegal practice undertaken with an intention to mislead the truth, obtain money, personal gain, or receive undue advantage. The requirement of burden of proof is generally higher in criminal fraud cases than in civil fraud cases. Hence, the given statement is "False". Therefore, the correct answer is .
Stock Options In the year 2001, when top management compensation was considered, most of them (80%)were stock options. Answer: False Justification: As per explanation given above, 80% of the top management compensation was in the form of stocks. Hence, the given statement is False. Hence, the correct answer is .
The Sarbanes Oxley Act (SOX) Sarbanes Oxley Act was set up in the year 2002. The main objective of this act is "to develop corporate responsibility, financial disclosures, corporate conflicts and accounting fraud". "Public Company Accounting Oversight Board" (PCAOB)was formed to supervise the audit profession of the public companies. More than 100 years, auditing profession performed in a self ruling manner. PCAOB has replaced the Public Oversight Board (POB). The Sarbanes Oxley Act was conceded in the year of "2002". Hence, this statement is incorrect. Therefore, the correct answer is .