Extra Credit

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Extra Credit 2 Jeff Chisholm 1 – Securities Exchange Commission (source: BYP4-5 of Kimmel textbook) What we do Answer the following questions: a. What event spurred the creation of the SEC? Why was the SEC created? The SEC was created due to the stock market crash of 1929 which led to the great depression. The SEC was created to protect investors in security exchanges such as the stock market. It is responsible for oversight of both private investment and corporate investment dealings. b. What are the five divisions of the SEC? Briefly describe the purpose of each. The five divisions of the SEC are corporate finance, enforcement, economic and risk analysis, investment management, and trading and markets. The corporate…show more content…
(Hint: Select Facts about FASB.) The mission of the FASB is to establish and improve upon accounting policies and procedures to ensure accurate reporting of market resources to investors. b. How is a standard created? (Hint: See Standard Setting Process.) The FASB board uses a cost benefit analysis to determine if a standards benefits justify the perceived cost associated with it. The board analyses the new standard then submits it for public review, they then review comments made by public, revise the standard, and then release the standard revision. c. Describe the make-up of the board members. (Hint: Select Board Members.) FASB board members are respected professionals in the field that are appointed by the board. Members are required to leave affiliation with any past firms so that they can be impartial and unbiased while working full time for the FASB. There are a total of 7 members that serve a 5 year term and are eligible to be appointed for a consecutive 5 year term. 3 – Public Company Accounting Oversight Board (PCAOB) (source: PYP7-6 Kimmel textbook.) The PCAOB was created as a result of the Sarbanes-Oxley Act. It has oversight and enforcement responsibilities over CPA firms in the United States. Public Comapany Accounting Oversight Board (PCAOB) a. What is the mission of the PCAOB? The mission of the PCAOB is to oversee audits of public corporations to protect the interests of the investor and ensure the audits are conducted

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