Certified Professional in Health Care Risk Management (CPHRM) Practice Exam 2026 - Free CPHRM Practice Questions and Study Guide

The Sarbanes-Oxley Act (SOX) is the correct choice because it was enacted in response to significant corporate scandals and financial mismanagement in the early 2000s. This legislation specifically aims to enhance corporate governance and improve the accuracy of financial reporting for publicly traded companies. SOX established stringent requirements for financial disclosures, including the implementation of internal controls over financial reporting, which are crucial for preventing fraud and ensuring accountability.

The act requires CEOs and CFOs to personally certify the accuracy of financial statements, creating a legal obligation that emphasizes the importance of transparency in financial practices. Additionally, it instituted severe penalties for fraudulent financial activity, thereby reinforcing ethical standards within the corporate environment.

In contrast, the other options focus on different aspects of regulation. The Safe Medical Device Act pertains specifically to the regulation of medical devices and their safety. The Risk Retention Act addresses liability insurance for certain risks but does not mandate financial accountability for public companies. The Healthcare Accountability Act deals with healthcare-related issues rather than corporate financial governance, making them irrelevant in the context of public company financial accountability.