Sarbanes Oxley Act Section 301

 

TITLE III—CORPORATE RESPONSIBILITY
SEC. 301. PUBLIC COMPANY AUDIT COMMITTEES.
 
Section 10A of the Securities Exchange Act of 1934 (15 U.S.C. 78f) is amended by adding at the end the following:
 
‘‘(m) STANDARDS RELATING TO AUDIT COMMITTEES.—
 
‘‘(1) COMMISSION RULES.—
 
‘‘(A) IN GENERAL.—Effective not later than 270 days
after the date of enactment of this subsection, the Commission
shall, by rule, direct the national securities exchanges
and national securities associations to prohibit the listing
of any security of an issuer that is not in compliance
with the requirements of any portion of paragraphs (2)
through (6).
 
‘‘(B) OPPORTUNITY TO CURE DEFECTS.—The rules of the
Commission under subparagraph (A) shall provide for
appropriate procedures for an issuer to have an opportunity
to cure any defects that would be the basis for a prohibition
under subparagraph (A), before the imposition of such
prohibition.
 
‘‘(2) RESPONSIBILITIES RELATING TO REGISTERED PUBLIC
ACCOUNTING FIRMS.—The audit committee of each issuer, in
its capacity as a committee of the board of directors, shall
be directly responsible for the appointment, compensation, and
oversight of the work of any registered public accounting firm
employed by that issuer (including resolution of disagreements
between management and the auditor regarding financial
reporting) for the purpose of preparing or issuing an audit
report or related work, and each such registered public
accounting firm shall report directly to the audit committee.
 
‘‘(3) INDEPENDENCE.—
 
‘‘(A) IN GENERAL.—Each member of the audit committee
of the issuer shall be a member of the board of
directors of the issuer, and shall otherwise be independent.
 
‘‘(B) CRITERIA.—In order to be considered to be independent
for purposes of this paragraph, a member of an
audit committee of an issuer may not, other than in his
or her capacity as a member of the audit committee, the
board of directors, or any other board committee—
 
‘‘(i) accept any consulting, advisory, or other
compensatory fee from the issuer; or
 
‘‘(ii) be an affiliated person of the issuer or any
subsidiary thereof.
 
‘‘(C) EXEMPTION AUTHORITY.—The Commission may
exempt from the requirements of subparagraph (B) a particular
relationship with respect to audit committee members,
as the Commission determines appropriate in light
of the circumstances.
 
‘‘(4) COMPLAINTS.—Each audit committee shall establish
procedures for—
 
‘‘(A) the receipt, retention, and treatment of complaints
received by the issuer regarding accounting, internal
accounting controls, or auditing matters; and
 
‘‘(B) the confidential, anonymous submission by
employees of the issuer of concerns regarding questionable
accounting or auditing matters.
 
‘‘(5) AUTHORITY TO ENGAGE ADVISERS.—Each audit committee
shall have the authority to engage independent counsel
and other advisers, as it determines necessary to carry out
its duties.
 
‘‘(6) FUNDING.—Each issuer shall provide for appropriate
funding, as determined by the audit committee, in its capacity
as a committee of the board of directors, for payment of
compensation—
 
‘‘(A) to the registered public accounting firm employed
by the issuer for the purpose of rendering or issuing an
audit report; and
 
‘‘(B) to any advisers employed by the audit committee
under paragraph (5).’’.

 

 
   

 

Sarbanes Oxley Compliance Professionals Association (SOXCPA)

Certified Sarbanes-Oxley Expert (CSOE) - Distance learning and online certification program