In Regard to Identifying and Evaluating Subsequent Events, AU 560

question 17

Multiple Choice

In regard to identifying and evaluating subsequent events, AU 560.12 specifies that the auditor inquires of management having responsibility for financial and accounting matters as to:

• A) any substantial contingent liabilities or commitments existing at the balance sheet date or report date.
• B) any significant changes in capital stock, long-term debt, or working capital to the date of inquiry.
• C) the current status of items previously accounted for on the basis of tentative, preliminary, or conclusive data.
• D) whether any unusual adjustments have been made since the report date.
• E) litigation, claims, and assessments.

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Definitions:

Chart of Accounts

A structured list categorizing all the accounts recorded in the general ledger of an organization, used for organizing financial transactions and preparing financial statements.

Recurring Transactions

Transactions that automatically repeat at regular intervals over a specified period, such as monthly subscriptions or periodic bill payments.

Gear Icon

A visual symbol often used in software interfaces to represent settings or configuration options.

Transactions Entered

The process of recording financial or other relevant data into a system or ledger.