The Main Reason the PCAOB Has Charged Chinese Affiliates of U.S.audit

question 46

Multiple Choice

The main reason the PCAOB has charged Chinese affiliates of U.S.audit firms with failing to provide sufficient documentary evidence of audits of Chinese companies listed on U.S.exchanges is:

• A)Audit firms are unable to gather sufficient competent evidential matter
• B)Audit firms are not knowledgeable enough about Chinese accounting standards
• C)Chinese regulatory agencies can be uncooperative in providing access to PCAOB regarding their inspections of audit documents
• D)Chinese regulatory agencies conduct inspections of the audit documents of the firms

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Definitions:

Balance Sheet

A balance sheet is a financial statement that summarizes a company's financial position at a specific point in time, detailing assets, liabilities, and shareholders' equity.

Accounting Records

Documentation and books that keep track of all financial transactions, assets, liabilities, equity, revenues, and expenses of an entity.

Transactions

The exchange of goods, services, or funds between two or more parties, forming the basis of accounting records.