Which of the Following Is a Principle Underlying an Audit

question 39

Multiple Choice

Which of the following is a principle underlying an audit conducted in accordance with generally accepted auditing standards?

• A)The audit provides reasonable assurance the client will remain in business for at least one year.
• B)The audit report expresses an opinion on whether the financial statements are free of material and immaterial misstatement.
• C)Auditors are responsible for,among other things,maintaining professional objectivism,exercising professional engagement,and obtaining appropriate documentation.
• D)An auditor's opinion enhances the degree of confidence that intended users can place in the financial statements.

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Definitions:

Large Corporation

A significantly sized company typically characterized by vast operations, substantial revenues, and a large number of employees.

Financial Asset

An intangible asset representing a legal claim to future payment, such as stocks, bonds, or bank deposits.

Security

A financial asset. Commonly a stock or a bond. An asset pledged to guarantee the repayment of a loan.

Stock

Equity securities representing ownership interest in a company; holders may enjoy dividends and voting rights.