chapter 2 LO3

Question 1

the PCAOB requires annual inspections of which accounting firms?

Answer 1

those that audit more than 100 public companies

Question 2

what did the Sarbanes-Oxley Act do?

Answer 2

Act—Established the Public Company Accounting Oversight Board (PCAOB

Question 3

the PCAOB is apointed and overseen by the?

Answer 3

SEC

Question 4

what did the 2010 Dodd frank financial reform legislation do?

Answer 4

auditors of brokers and dealers registered with SEC are required to register with the PCAOB , are subject to inspections, and must follow PCAOB auditing and attestation standards

Question 5

what does the PCAOB do?

Answer 5

Provides oversight for auditors of public companies

Question 6

what kind of oversight does the PCAOB do? (2)

Answer 6

1. Establishing auditing, attestation, and quality control standards for public company audits 2. Performing inspections of audit engagements and the quality controls at audit firms performing those audits

Question 7

The PCAOB requires inspections of other registered firms that dont audit more than 100 public companies how often?

Answer 7

every 3 years

Question 8

The PCAOB conducts inspections of registered accounting firms to assess what 3 things

Answer 8

1. their compliance witht he rules of the PCAOB and SEC 2. professional standards 3. each firms own quality control policies

Question 9

during inspections by PCAOB what happens if there are any violations?

Answer 9

they could result in disciplinary action by the PCAOB and be reported to the SEC and state accountancy boards