Why Is the Auditor Concerned About the Appropriateness of the Going

question 2

Multiple Choice

Why is the auditor concerned about the appropriateness of the going concern assumption?

• A)It may motivate management to misstate the financial report.
• B)The auditor needs to audit the solvency statement in the directors' declaration
• C)It may affect the appropriateness of the financial report.
• D)All of the given answers are correct.

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Definitions:

Partnership Agreement

A legal document that specifies the rights, obligations, and responsibilities of each partner in a business partnership.

Initial Investment

The initial amount of money put into a project, asset, or venture to start it or acquire it.

Capital

Assets or resources that are used to generate income or invested to create financial gains.

Proportion

A comparative relationship between parts of a whole, often expressed as a ratio or fraction.