Which of the following is true of Section 10A of the Securities Exchange Act of 1934?
A) It prohibits any manipulative or deceptive practice in connection with the process of the probate.
B) It serves as a defense an accountant can assert by claiming due diligence to avoid civil liability.
C) It enforces a duty on auditors to detect and report illegal acts committed by their clients.
D) It imposes a criminal liability on accountants for making misstatements or omissions in nonaudit services.

Question

Quizplus · Accepted Answer

Section 10A of the Securities Exchange Act of 1934 mandates auditors to report illegal acts they find during the audit of a company's financial statements to the company's board of directors. If the issue is not adequately addressed, the auditor must report it to the Securities and Exchange Commission (SEC). This section does not deal with probate processes, provide a specific defense for accountants regarding civil liability, or impose criminal liability for misstatements in nonaudit services.

Which of the Following Is True of Section 10A of the Securities