The Primary Emphasis by Auditors Is on Controls Over

question 22

Multiple Choice

The primary emphasis by auditors is on controls over

• A) classes of transactions.
• B) account balances.
• C) both A and B, because they are equally important.
• D) both A and B, because they vary from client to client.

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Definitions:

Reacquired

Refers to stock or securities that a company buys back from its shareholders.

Originally Issued

Refers to securities or financial instruments that are sold for the first time to investors.

Stated Value

The nominal value of a share of stock as determined by the issuing company, which may differ from its market value.

Common Stock

Shares entitling their holder to dividends that vary in amount and may even be missed, depending on the fortunes of the company.