WebFieldTrip-Unit2 - P rofessor and Class, What does...

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Professor and Class, What does Section 404 require of management’s internal control report? First of all, internal control is defined as the procedures or processes used by a company to safeguard its assets, process information accurately, and ensure compliance with laws and regulations. (Our Textbook, pg. 348) The Sarbanes-Oxley Act of 2002 requires companies to maintain strong and effective internal controls over the recording of transactions and the preparing of financial statements. This act also requires their independent accountants to report on the effectiveness of the company’s internal controls, and to include these reports with the company’s annual 10K report. The act also encourages the companies to include these reports with the annual reports supplied to stockholders. (Our Textbook, pg. 349) The SEC requires a company’s annual report to include an internal control report of management. Their reports must contain or include the flowing items: 1) A statement of management’s responsibility for establishing and maintaining
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WebFieldTrip-Unit2 - P rofessor and Class, What does...

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