Which of the Following Would Not Be Considered a Significant

question 361

Multiple Choice

Which of the following would not be considered a significant audit finding that should be included in audit documentation?

• A) Retirement of the accounts payable manager and subsequent hiring of a replacement.
• B) Discovery of a material sale recorded in the current year that properly belonged in the subsequent year.
• C) Determination that there is substantial doubt about the entity's ability to continue as a going concern.
• D) Implementation of a new accounting standard to account for a complex and unusual transaction.

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Definitions:

FASB Conceptual Framework

A foundational set of objectives and concepts that guide the Financial Accounting Standards Board in developing accounting standards.

GAAP

Generally Accepted Accounting Principles; a collection of commonly followed accounting rules and standards for financial reporting in the United States.

Financial Reporting

Financial reporting involves the disclosure of financial information to various stakeholders about the company's performance over a period.

Management's Responsibility

The obligation of an organization's management to ensure accurate and complete financial reporting, adherence to laws and regulations, and effective operation of the entity.