Before Performing a Compilation of the Financial Statements of a Nonpublic

question 61

Multiple Choice

Before performing a compilation of the financial statements of a nonpublic entity, an accountant should:

• A)perform a thorough study and evaluation of the internal control system.
• B)complete a series of inquiries concerning the entity's procedures for recording, classifying, and summarizing transactions.
• C)design working papers intended to provide sufficient competent evidential matter to afford a reasonable basis for a compilation opinion.
• D)obtain an understanding of the accounting principles and practices of the industry in which the entity operates.

---

Definitions:

PATRIOT Act

Legislation enacted in the United States to enhance law enforcement investigatory tools and abilities, particularly in response to terrorism.

Equal Employment Opportunity Commission

A federal agency responsible for enforcing laws against workplace discrimination and advocating for fair treatment of all employees.

National Labor Relations Board

The National Labor Relations Board (NLRB) is an independent US federal agency responsible for enforcing US labor law in regard to collective bargaining and unfair labor practices.

Equal Employment Opportunity Legislation

Laws designed to prevent discrimination in the workplace based on race, color, religion, sex, national origin, age, disability, or genetic information.