Who Bears Ultimate Responsibility for the Financial Statements

question 58

Multiple Choice

Who bears ultimate responsibility for the financial statements?

• A)Management of the organization, equally with the external auditor that audits the statements.
• B)Management and the shareholders of the organization.
• C)The external auditor that audits the statements.
• D)Management of the organization.

---

Definitions:

Double-Entry Bookkeeping System

A financial recording system where each transaction is recorded in two different accounts as opposite entries, one as a debit and the other as a credit, to keep the balance of the accounting equation intact.

Single-Entry System

An accounting method where each financial transaction is recorded with a single entry to the accounting records, typically suited for small, simple businesses.

Accounting Records

Documentation of financial transactions and the financial status of a business, serving as a foundation for accounting.

Automatic Update

A feature in software that enables the automatic download and installation of new updates without manual intervention.