Which Is NOT One of the Common Sources of Distortions

question 20

Multiple Choice

Which is NOT one of the common sources of distortions in financial statements?

• A)accounting standards that are inconsistent with economic reality
• B)management estimation errors
• C)miscalculation of foreign currency translation
• D)management of earnings

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Definitions:

Internal Consistency

A measure of how well the items on a test measure the same construct or concept.

Reliability

The consistency and stability of a measurement over multiple trials or observations.

Construct Validity

The degree to which an assessment or tool accurately gauges the theoretical idea or construct it aims to assess.

Error Score

The difference between the observed score and the true score.