As Part of Their Internal Control Procedures, Management Needs to Have

question 145

Multiple Choice

As part of their internal control procedures, management needs to have procedures in place to properly classify financial instruments as trading, available-for-sale, or held-to-maturity, based on

• A) cost.
• B) intent.
• C) maturity.
• D) probable future gain or loss.

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Definitions:

Financial Information

Data concerning the financial status, performance, and changes in financial position of an entity that is useful to a wide range of users in making economic decisions.

Conceptual Framework Project

A systematic approach to developing a set of concepts that guide the creation, interpretation, and application of financial reporting and accounting standards.

Objectives of Financial Reporting

The goal of providing financial information about the reporting entity that is useful to present and potential equity investors, lenders, and other creditors in making decisions about providing resources to the entity.