The Auditor's Program for the Examination of Long-Term Debt Should

question 24

Multiple Choice

The auditor's program for the examination of long-term debt should include steps that require the:

• A)verification of the existence of the bond holders.
• B)examination of any bond agreement.
• C)inspection of the accounts payable subsidiary ledger.
• D)investigation of credits to the bond interest income account.

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Definitions:

U.S. Accounting Standards

The accounting principles, standards, and procedures established by the U.S. Financial Accounting Standards Board (FASB) for domestic companies.

GAAP

Generally Accepted Accounting Principles, a collection of commonly-followed accounting rules and standards for financial reporting.

IFRS

A collection of accounting standards crafted by the International Accounting Standards Board to be utilized worldwide, known as International Financial Reporting Standards.

Inventory Write-Downs

Reductions in the book value of inventory that occur when the market value drops below the cost recorded on the financial statements.