In 'Auditing' Accounting Data, the Primary Concern Is With

question 74

Multiple Choice

In 'auditing' accounting data, the primary concern is with:

• A) determining if fraud has occurred.
• B) determining whether recorded information properly reflects the economic events that occurred during the accounting period.
• C) analysing the nonfinancial information to be sure that it complies with government requirements.
• D) determining if taxable income has been calculated correctly.

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Definitions:

De Facto Corporation

A company that operates as if it were legally incorporated, despite not having completed the necessary incorporation processes, and may thus be treated as a corporation in many contexts.

Shareholders

Owners of shares in a company, giving them rights to vote on company matters and receive dividends.

S Corporation

A special designation that allows small businesses to pass corporate income, losses, deductions, and credits through to their shareholders for federal tax purposes.

S Corporation

A specific kind of corporation in the U.S. that conforms to certain Internal Revenue Code criteria, which permits it to distribute income directly to its shareholders, thereby bypassing the double taxation issue.