After the Balance Sheet Date, but Prior to the Issuance

question 95

Multiple Choice

After the balance sheet date, but prior to the issuance of the audit report, the client suffers an uninsured loss of their inventory as a result of a fire. The amount of the loss is material. The auditor should

• A) adjust the financial statements for the year under audit.
• B) add a paragraph to the audit report.
• C) advise the client to disclose the event in the notes to the financial statements.
• D) advise the client to delay issuing the financial statements until the economic loss can be determined.

Understand the concepts of behavioral consistency and personality shaping factors.

Comprehend Freud's structural model of personality dividing it into id, ego, and superego.

Learn about the defense mechanisms of the ego and their function in managing anxiety.

Understand the concept of psychic energy in Freud's theory and its role in powering the mind.

---

Definitions:

Current Liabilities

Short-term obligations that will be paid or settled within the coming year in cash, goods, other current assets, or services.

Gross Profit Percentage

A financial metric that shows the proportion of profit a company makes after subtracting the cost of goods sold from its total revenue.

Net Sales Revenue

The amount of revenue generated from sales after deducting returns, allowances for damaged goods, and discounts.

Earnings Per Share

A financial ratio that measures the amount of a company's net income allocated to each outstanding share of common stock.