Audit Documents

question 95

Multiple Choice

Audit documents

• A) are kept by the client for easy reference for their accounting staff.
• B) should be considered as a substitute for the clients accounting records.
• C) are designed to facilitate the review and supervision of the work performed by the audit team by a reviewing partner.
• D) prepared during the engagement are the property of the client once the audit bill is paid.

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Definitions:

Net Income

A business's residual profit after all operational costs and tax charges are extracted from its total revenues.

Common-Size Statement

A financial statement in which all items are expressed as a percentage of a common base figure, facilitating comparison across different periods or companies.

Net Fixed Assets

The value of a company’s long-term, tangible assets minus any depreciation, representing the net book value of physical assets.

Inventory

The goods and materials that a business holds for the ultimate goal of resale or processing in the production process.