With Respect to Management's Disclosure Required for Going Concern Issues

question 108

Multiple Choice

With respect to management's disclosure required for going concern issues, _______.

• A)if management determines that the disclosure is fairly presented in accordance with the applicable financial reporting framework, then an unmodified auditor's report can still be issued
• B)if auditors determine that the disclosure is fairly presented in accordance with the applicable financial reporting framework, then an unmodified auditor's report can still be issued
• C)the auditor should advise management that they are now unable to issue an unmodified audit opinion
• D)the auditor should advise management that they are now unable to issue a modified audit opinion

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Definitions:

Factored Accounts Receivable

The process of selling accounts receivable to a third party at a discount to quickly generate cash and reduce risk of non-payment.

Commission

A fee paid for services, usually a percentage of the total cost, to an agent or employee for facilitating or completing a sale.

Factoring Transaction

A financial transaction where a business sells its accounts receivable to a third party (the factor) at a discount.