The Unmodified Standard Audit Report of a Nonpublic Company Does

question 6

Multiple Choice

The unmodified standard audit report of a nonpublic company does not explicitly state that:

• A)The financial statements are the responsibility of the company's management.
• B)The audit was conducted in accordance with accounting principles generally accepted in the United States of America.
• C)The auditors believe that the audit provides a reasonable basis for their opinion.
• D)An audit includes evaluating the appropriateness of accounting policies used.

---

Definitions:

Overhead Expenses

Costs not directly tied to the production of goods or services, such as rent, utilities, and administrative salaries.

Operating Profit

Earnings of a business before interest and taxes are deducted.

Rate of Mark-up

A pricing strategy calculation, expressed as a percentage, indicating how much higher a product's selling price is compared to its cost to produce or purchase.

Overhead Expenses

Costs not directly tied to the creation of a product or service but necessary for running a business, such as rent and utilities.