Regulatory Frameworks & Compliance Flashcards
7 cards from real Certified Public Accountant practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Regulatory Frameworks & Compliance flashcards as text
Under the Dodd-Frank Act, which entity has primary authority to regulate systemically important financial institutions (SIFIs)?
Answer: Financial Stability Oversight Council (FSOC)
The Financial Stability Oversight Council (FSOC), created by Dodd-Frank, designates and oversees systemically important financial institutions.
A CPA discovers that a client's financial statements contain a material misstatement that the client refuses to correct. Under AICPA ethics rules, what is the CPA's appropriate action regarding an audit engagement?
Answer: Issue a qualified or adverse opinion, or withdraw from the engagement
When a client refuses to correct a material misstatement, the auditor must modify their opinion (qualified or adverse) or withdraw from the engagement.
Which SEC regulation requires companies to disclose information about off-balance-sheet arrangements and contractual obligations in their annual reports?
Answer: Regulation S-K Item 303 (MD&A)
Regulation S-K Item 303 (Management's Discussion and Analysis) requires disclosure of off-balance-sheet arrangements and contractual obligations.
Under the Bank Secrecy Act (BSA), what is the threshold for filing a Currency Transaction Report (CTR)?
Answer: $10,000
Financial institutions must file a CTR for cash transactions exceeding $10,000 in a single business day.
The PCAOB's AS 2201 standard primarily governs which aspect of an audit engagement?
Answer: Auditing internal control over financial reporting
AS 2201 (formerly AS 5) establishes requirements for auditing internal control over financial reporting integrated with the audit of financial statements.
Which provision of Sarbanes-Oxley makes it a criminal offense for an audit partner to destroy, alter, or conceal documents related to a federal investigation?
Answer: Section 802
SOX Section 802 imposes criminal penalties for destroying, altering, or concealing documents in federal investigations or bankruptcy proceedings.
A public company CPAs must retain audit workpapers for a minimum of how many years under SEC rules?
Answer: 7 years
SEC rules require auditors of public companies to retain audit documentation for at least 7 years from the completion of the engagement.