An Accountant's Report Expressing an Opinion on an Entity's Internal

question 3

Multiple Choice

An accountant's report expressing an opinion on an entity's internal control should:

• A) clearly disclaim responsibility for the establishment and maintenance of internal control.
• B) state that the study and evaluation of internal control was conducted in accordance with generally accepted auditing standards.
• C) include an opinion concerning management's assertions about whether the cost of correcting any material weaknesses or deficiency would exceed the benefits of reducing the risk of errors and irregularities.
• D) briefly explain the broad objectives and inherent limitations of internal control.

---

Definitions:

Income Ratios

Financial metrics that compare different aspects of a company's income, such as net income to sales, to assess its financial performance and profitability.

Partnership Cash

Funds or capital held by a partnership, which is a business entity owned by two or more individuals.

Death of a Partner

A situation in a partnership where one of the partners passes away, requiring the partnership to address the consequences and redistribution of the deceased partner's interest.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue, a key indicator of the company's financial health and profitability.