Analytical Procedures During Risk Assessment of a Going Concern _______

question 30

Multiple Choice

Analytical procedures during risk assessment of a going concern _______.

• A)May identify negative trends such as working capital deficiencies, adverse key financial ratios, and decreasing cash flow from operations
• B)May identify positive trends such as working capital deficiencies, adverse key financial ratios, and decreasing cash flow from operations
• C)May identify only external matters that have occurred such as loss of a key franchise, loss of a principal customer, or work stoppages due to natural disaster
• D)May identify internal matters that have occurred such as legal proceedings

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Definitions:

Entrepreneurial Firms

Companies that pursue opportunities, regardless of the resources they currently control, characterized by innovation, risk-taking, and proactiveness.

Investing Wisely

The process of allocating resources, typically money, in different financial instruments or assets with the aim of generating favorable returns while managing risks.

Flexible

The ability to adapt to changes and respond to varying needs and conditions with ease.

Succession Plan

A strategy for passing on leadership roles, often including the ownership of a company to an heir or successor.