Which of the Following Phrases Would Auditors Most Likely Include

question 53

Multiple Choice

Which of the following phrases would auditors most likely include in their report when expressing a qualified opinion on the entity's financial statements because of inadequate disclosure?

• A)"Subject to the departure from generally accepted accounting principles,as described above".
• B)"With the foregoing explanation of these omitted disclosures".
• C)"Except for the omission of the information discussed in the preceding paragraph".
• D)"Does not present fairly in all material respects".

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Definitions:

Adjusted Trial Balance

A listing of all company accounts and their balances after adjustments, serving as the basis for financial statement preparation.

Return on Assets Ratio

A measure of how effectively a company uses its assets to generate profit, calculated as net income divided by total assets.

DuPont Approach

A method of performance measurement that breaks down return on equity (ROE) into three components: operating efficiency, asset use efficiency, and financial leverage, to help analyze a company's financial condition.

Return on Assets Ratio

A profitability ratio that indicates how efficiently a company uses its assets to generate profit, calculated as net income divided by total assets.