Question

Which of the following is not a provision of the Sarbanes-Oxley Act?

1) A requirement to retain audit workpapers for at least five years.
2) It is a criminal offense to take any harmful action in retaliation against anyone who voluntarily comes forward to report a suspected accounting or securities fraud.
3) Broad investigative and disciplinary authority over registered public accounting firms is granted to the Public Company Accounting Oversight Board.
4) The statute of limitations for actions under Section 10(b) and Rule 10b-5 was reduced to one year from the discovery of fraud and five years after the fraud occurred.

Answer 1

Option 4, regarding the statute of limitations for actions under Section 10(b) and Rule 10b-5, is not a provision of the Sarbanes-Oxley Act.

Step-by-step explanation:

The provision that is not a part of the Sarbanes-Oxley Act is option 4: The statute of limitations for actions under Section 10(b) and Rule 10b-5 was reduced to one year from the discovery of fraud and five years after the fraud occurred. The correct provisions under the Sarbanes-Oxley Act include:

• A requirement to retain audit workpapers for at least five years.
• It is a criminal offense to take any harmful action in retaliation against anyone who voluntarily comes forward to report a suspected accounting or securities fraud.
• Broad investigative and disciplinary authority over registered public accounting firms is granted to the Public Company Accounting Oversight Board (PCAOB).

These measures were implemented to address accounting scandals and restore investor confidence in the financial reports of public corporations, thus protecting them from accounting fraud.