Which of the Following Is Correct When a Company Is

question 34

Multiple Choice

Which of the following is correct when a company is issuing summary financial statements developed from audited financial statements?

• A)Such summary statements should always have a CPA's report associated with them when audited financial statements exist.
• B)The CPA may issue a report on whether the summary information is fairly stated in all material respects in relation to the basic financial statements.
• C)The CPA should perform a compilation and review of the summary financial statements.
• D)The CPA who has audited the financial statements who is asked to report on the summary statements should decline the engagement because the summary statements do not include all disclosures necessary under generally accepted accounting principles.

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Definitions:

Rhizome

A horizontal underground stem that bears leaves and buds and often serves as a storage organ and a means of asexual reproduction (e.g., iris).

Horizontal

Refers to something that is arranged or lying flat, parallel to the plane of the horizon or perpendicular to the vertical.

Aboveground

Referring to the part of a plant or structure that is visible or exists above the surface of the soil or ground.

Endosperm

The nutritive tissue inside the seeds of most flowering plants, surrounding and nourishing the embryo.