Which of the Following Is Not a Consequence of the Standards

question 7

Multiple Choice

Which of the following is not a consequence of the standards overload problem to small businesses?

• A) If a small business omits a GAAP requirement from audited financial statements, a qualified or adverse opinion may be rendered.
• B) Small businesses do not need to keep financial records
• C) The cost of complying with GAAP requirements may cause a small business to forgo the development of other, more relevant information.
• D) Small CPA firms that audit smaller companies must keep up to date on all the same requirements as large international firms, but they cannot afford the specialists that are available on a centralized basis in the large firms.

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Definitions:

Maximum Rate

The highest permissible interest rate or charge on a loan as defined by law or regulation.

Illegal Bet

A wager placed in violation of laws or regulations governing gambling activities.

Withdraw

To remove or take back something previously offered or put forward, or to exit a process or situation.

Fraudulent Means

The use of deception, cheating, or manipulation with the aim of gaining an unfair advantage or causing harm to another party.