A Professional Accountant Is Auditing Client a and Providing Consulting

question 6

Multiple Choice

A professional accountant is auditing client A and providing consulting services to client B. Both clients are in the same industry. If the professional accountant uses specific information from client A's audit to prepare a business plan for client B, he will be violating the following fundamental principle.

• A)Integrity
• B)Objectivity
• C)Professional due care
• D)Confidentiality
• E)All of the above

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Definitions:

Leverage Ratio

A financial indicator that measures the extent of a company's reliance on borrowed funds in its capital structure.

Liquidity Ratios

Financial metrics used to determine an organization's ability to pay off its short-term debts with its liquid assets.

Exchange Rates

The value of one currency for the purpose of conversion to another, influencing international trade and investment.

Consolidated Financial Statements

Consolidated Financial Statements are financial reports that combine the financial position, results of operations, and cash flows of a parent company and its subsidiaries into one document.