Which of the Following Statements Concerning Financial Reporting Is TRUE

question 121

Multiple Choice

Which of the following statements concerning financial reporting is TRUE?

• A) The FASB requires all financial decision makers to adhere to a code of professional conduct.
• B) The Sarbanes-Oxley Act does not require businesses to maintain an audited system of internal control.
• C) A fundamental characteristic of useful financial information is that it fully depicts the economic substance of business activities.
• D) There is no attempt to eliminate the difference in accounting rules in the U.S. and elsewhere as this would

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Definitions:

Expert Power

The influence and authority someone has due to their specialized knowledge or expertise.

Coercive Power

A form of power that is based on the ability to deliver punishments or impose sanctions on others.

Referent Power

is the influence one has over others based on their loyalty, respect, or admiration towards the person.

Expert Power

Influence or authority derived from the expertise, skills, or knowledge that a person has in a particular area.