If an Auditor Dates the Auditor's Report on Financial Statements

question 31

Multiple Choice

If an auditor dates the auditor's report on financial statements for the year ended December 31,2011,as of February 10,2012,except for Note J,as to which the date is March 3,2012,the auditor is acknowledging responsibility to actively search for and ensure proper handling by management of

• A) All subsequent events occurring through March 3, 2012.
• B) All subsequent events occurring through February 10, 2012.
• C) All subsequent events occurring through February 10, 2012 and the specific subsequent event referred to in Note J through March 3, 2012.
• D) Only the specific subsequent event referred to in Note J as of March 3, 2012.

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Definitions:

Diminishing-Balance Method

A method of accelerated depreciation where an asset loses value by a fixed percentage each year over its useful life.

Constant Percentage

A fixed rate applied over time or across instances, often used in calculation methods or financial formulas.

Straight-Line Depreciation

is a method of calculating the depreciation of an asset by evenly spreading its cost over its useful life.