The Sarbanes-Oxley Act requires that the CEO (chief executive officer) and CFO (chief financial officer) of publicly traded corporations include statements of personal certification in the disclo-sures accompanying the financial reports filed with the SEC. In essence, these statements hold the CEO and CFO personally liable for their company’s annual report content. The personal certifica-tions must be signed by both the CEO and the CFO. Each certification requires that the CEO and CFO commit to the following statements:1. I have reviewed this annual report.2. On the basis of my knowledge, this report does not contain any untrue statements of materialfacts or omissions of material facts.3. On the basis of my knowledge, the financial statements, and other financial informationincluded in this report, fairly present in all material respects the financial condition, results ofoperations, and cash flows of the business.4. I am responsible for establishing and maintaining disclosure controls and procedures.5. I have disclosed any fraud, whether or not material, and have disclosed all significant controldeficiencies and material weaknesses involving the company’s financial reporting.InstructionsAs a group, discuss the meaning and purpose of the personal certification requirement. How mightthis requirement contribute to improved investor confidence?
The Sarbanes-Oxley Act requires that the CEO (chief executive officer) and CFO (chief financial
officer) of publicly traded corporations include statements of personal certification in the disclo-
sures accompanying the financial reports filed with the SEC. In essence, these statements hold the
CEO and CFO personally liable for their company’s annual report content. The personal certifica-
tions must be signed by both the CEO and the CFO. Each certification requires that the CEO and
CFO commit to the following statements:
1. I have reviewed this annual report.
2. On the basis of my knowledge, this report does not contain any untrue statements of material
facts or omissions of material facts.
3. On the basis of my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the financial condition, results of
operations, and cash flows of the business.
4. I am responsible for establishing and maintaining disclosure controls and procedures.
5. I have disclosed any fraud, whether or not material, and have disclosed all significant control
deficiencies and material weaknesses involving the company’s financial reporting.
Instructions
As a group, discuss the meaning and purpose of the personal certification requirement. How might
this requirement contribute to improved investor confidence?
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