When the Proper Disclosure in the Financial Statements of Material

question 43

Multiple Choice

When the proper disclosure in the financial statements of material contingencies is through footnotes, the footnote should describe the nature of the contingency to the extent it is known and:

• A) the auditor's opinion as to the expected outcome.
• B) the steps client has taken to ensure that it doesn't recur.
• C) the opinion of legal advisers or management as to the expected outcome.
• D) the opinion of an outside independent party, such as an appraiser, as to the expected outcome.

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Definitions:

Freud

Sigmund Freud, an Austrian neurologist, established psychoanalysis as a technique for addressing mental disorders through conversations between a psychoanalyst and their patient.

Bandura

Albert Bandura, a psychologist known for his work on social learning theory, emphasizing the importance of observing, modelling, and imitating the behaviors, attitudes, and emotional reactions of others.

Rogers

Refers to Carl Rogers, an influential American psychologist who founded the client-centered approach to therapy, emphasizing empathy and unconditional positive regard.

Illogical Thinking Process

A pattern of thought characterized by conclusions and reasoning that are not consistent with logical principles, often manifesting in various cognitive distortions.