Which Term Refers to an Affiliate Relationship Between an Accounting/auditing

question 61

Multiple Choice

Which term refers to an affiliate relationship between an accounting/auditing firm and its sponsoring organization?

• A)Parent/subsidiary
• B)Hooking up
• C)Guanxi
• D)Principal/Agent

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Definitions:

Accounting Methods

The specific rules and procedures adopted by a business for reporting income and expenses.

Investor

An individual or entity that allocates capital with the expectation of receiving financial returns, encompassing a wide range of investment vehicles and activities.

Consolidation

The process of combining the financial statements of multiple subsidiary companies into the statements of a single parent company.

Available-for-Sale Securities

Financial assets that are neither held for trading immediately nor held to maturity, which can be sold in response to liquidity needs.