Small and Tall,CPAs Completed the December 31,2017 Audit of Big

question 10

Multiple Choice

Small and Tall,CPAs completed the December 31,2017 audit of Big Company on February 10,2018.After the audit report release date,an outstanding lawsuit against Big Company was settled for materially more than recorded in the December 31,2017 financial statements.The amount recorded in the financial statements represented the best estimate of management and the company's attorneys at the time the audit was completed.Based on this new information,Small and Tall,CPAs should

• A)Determine whether persons are currently relying on the auditors' reports.
• B)Advise the client to make appropriate changes in the financial statements and reissue them.
• C)Notify each member of the board of directors of Big Company.
• D)Take no action since the event took place after the audit report release date.

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Definitions:

Taylor's Approach

A management theory developed by Frederick Winslow Taylor, emphasizing scientific studies of tasks to increase productivity.

Increasing Efficiency

The process of improving the capability of a system or process to produce the desired output with minimum input or effort.

World War II

A global conflict that lasted from 1939 to 1945, involving most of the world's nations and culminating in significant changes to the geopolitical landscape.

Workplace Situation

The conditions and circumstances that occur within a place of employment.