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Under the auditing standards required by the Sarbanes-Oxley Act, how long must audit work papers and documentation for audit reports be kept?
AThree years
BFive years
CTen years
DSeven years
Answer & Solution
Correct answer: D. Seven years
1. The Sarbanes-Oxley Act tells the oversight board to build several requirements into its auditing standards.
2. One of them is that audit work papers and other documentation for audit reports be maintained for seven years.
3. The same standards require review and approval of audit reports by a second partner.
4. They also require standards for quality control and for the review of internal control procedures.
5. Three, five and ten years are near misses on a retention period that is fixed at seven.
6. Altering or destroying key audit documents now carries felony charges and increased penalties, which is why the retention period is stated exactly.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 14 "Using Financial Information and Accounting", section 14.2 The Accounting Profession_
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