The Objective of the Second PCAOB Standard of Reporting Is

question 58

Multiple Choice

The objective of the second PCAOB Standard of Reporting is to provide assurance that

• A) There are no variations in the format and presentation of financial statements.
• B) Substantially different transactions and events are not accounted for on an identical basis.
• C) The auditor is consulted before material changes are made in the application of accounting principles.
• D) The comparability of financial statements between periods is not materially affected by changes in accounting principles that are not disclosed.

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Definitions:

Escrow Account

A financial arrangement where a third party holds funds on behalf of transacting parties until specified conditions are met.

Neutral Third Party

An unbiased, independent individual or group engaged to help resolve disputes, negotiate agreements, or oversee transactions.

Deposit

A sum of money placed in an account or with a third party as a security for the performance of an obligation or the purchase of something.

Tenancy by the Entirety

A form of joint property ownership reserved for married couples, where each spouse has an equal and undivided interest in the property.