Which of the Following Representations Does an Accountant Make Implicitly

question 654

Multiple Choice

Which of the following representations does an accountant make implicitly when issuing the standard report for the compilation of a nonissuer's financial statements?

• A) The accountant is independent with respect to the entity.
• B) The financial statements have not been audited.
• C) A compilation consists principally of inquiries and analytical procedures.
• D) The accountant does not express any assurance on the financial statements.

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Definitions:

Stated Interest Rate

The annual interest rate declared on a financial instrument, such as a loan or bond, not taking into account compounding or fees.

Market Interest Rate

The prevailing rate of interest available in the market, influencing the rates charged on loans and paid on deposits.

Face Value

The face value or monetary amount displayed on a bond, note, or any financial document, indicating the total due upon its maturity.

Operating Lease

A lease agreement allowing a business to use an asset without ownership, often with lower payments and shorter terms than a finance lease.