When an Accountant Has Not Followed Generally Accepted Auditing Standards,which

question 90

Multiple Choice

When an accountant has not followed generally accepted auditing standards,which of the following is true?

• A) The accountant is negligent.
• B) The accountant is presumed to be negligent,but the accountant can possibly rebut that presumption.
• C) The accountant will be liable for any losses suffered by users of the financial statements.
• D) The accountant will lose his license to practice the profession of accountancy.

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Definitions:

Discretionary Costs

Expenses that are not essential for the operation of a business, such as advertising or research and development, which can be adjusted or eliminated depending on financial performance.

Research and Development

A business or government activity that involves the investment of resources in the development and refinement of new products, services, or processes.

Service Department

A segment of an organization that does not directly produce goods but provides support services to other departments that do.

Service Orders

Requests or instructions for maintenance, repairs, or other service activities, typically issued by customers or companies.