Party Overview of Responsibilities Stockholders Provide effective oversight through election of board members, through approval of major initiatives (such as buying or selling stock), and through annual reports on management compensation from the board Board of Directors Serve as representatives of stockholders ensure that the organization is run according to the organizations charter and that there is proper accountability Specific activities include Selecting management Reviewing management performance and determining compensation Declaring dividends Approving major changes, such as mergers Approving corporate strategy Overseeing accountability activities Management Manage the organization effectively provide accurate and timely accountability to shareholders and other stakeholders Specific activities include Formulating strategy and risk management Implementing effective internal controls Developing financial and other reports to meet public, stakeholder, and regulatory requirements Managing and reviewing operations Implementing an effective ethical environment Audit Committees of the Board of Directors Provide oversight of the internal and external audit function and over the process of preparing the annual financial statements and public reports on internal control Specific activities include Selecting the external audit firm Approving any nonaudit work performed by the audit firm Selecting and or approving the appointment of the chief audit executive (internal auditor) Reviewing and approving the scope and budget of the internal audit function Discussing audit findings with internal and external auditors, and advising the board (and management) on specific actions that should be taken Regulators and Standards Setters (PCAOB, SEC, AICPA, FASB, IAASB, IASB) Set accounting and auditing standards dictating underlying financial reporting and auditing concepts set the expectations of audit quality and accounting quality Specific activities include Establishing accounting principles Establishing auditing standards Interpreting previously issued standards Enforcing adherence to relevant standards and rules for public companies and their auditors Discuss Consider the roles and responsibilities of each of these parties with corporate governance responsibilities Which party do you think is most responsible for preventing fraud Which party do you think is most responsible for detecting fraud Provide formal discussion

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Posted on Sep 16, 2024

Party Overview of Responsibilities Stockholders Provide effective oversight through election of board members, through approval of major initiatives (such as buying or selling stock), and

Party	Overview of Responsibilities
Stockholders	Provide effective oversight through election of board members, through approval of major initiatives (such as buying or selling stock), and through annual reports on management compensation from the board
Board of Directors	Serve as representatives of stockholders; ensure that the organization is run according to the organizations charter and that there is proper accountability Specific activities include: Selecting management Reviewing management performance and determining compensation Declaring dividends Approving major changes, such as mergers Approving corporate strategy Overseeing accountability activities
Management	Manage the organization effectively; provide accurate and timely accountability to shareholders and other stakeholders Specific activities include: Formulating strategy and risk management Implementing effective internal controls Developing financial and other reports to meet public, stakeholder, and regulatory requirements Managing and reviewing operations Implementing an effective ethical environment
Audit Committees of the Board of Directors	Provide oversight of the internal and external audit function and over the process of preparing the annual financial statements and public reports on internal control Specific activities include: Selecting the external audit firm Approving any nonaudit work performed by the audit firm Selecting and/or approving the appointment of the chief audit executive (internal auditor) Reviewing and approving the scope and budget of the internal audit function Discussing audit findings with internal and external auditors, and advising the board (and management) on specific actions that should be taken
Regulators and Standards Setters (PCAOB, SEC, AICPA, FASB, IAASB, IASB)	Set accounting and auditing standards dictating underlying financial reporting and auditing concepts; set the expectations of audit quality and accounting quality Specific activities include: Establishing accounting principles Establishing auditing standards Interpreting previously issued standards Enforcing adherence to relevant standards and rules for public companies and their auditors

Discuss

Consider the roles and responsibilities of each of these parties with corporate governance responsibilities. Which party do you think is most responsible for preventing fraud? Which party do you think is most responsible for detecting fraud?

Provide formal discussion.