Which of the Following Statements Is Correct Concerning an Auditor's

question 30

Multiple Choice

Which of the following statements is correct concerning an auditor's required communication with those charged with governance?

• A) This communication is required to occur before the auditor's report on the financial statements is issued.
• B) This communication should include management changes in the application of significant accounting policies.
• C) Any significant matter communicated to those charged with governance also should be communicated to management.
• D) Significant audit adjustments proposed by the auditor and recorded by management need not be communicated to those charged with governance.

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Definitions:

Accord And Satisfaction

A contract law concept where a dispute is settled by an agreement (accord) and the subsequent payment (satisfaction), which discharges the original contractual obligation.

Mutual Agreement

A consensus or accord reached between two or more parties on a matter, often formalized through a contract or verbal understanding.

Specific Performance

An equitable remedy requiring the breaching party to perform as promised under the contract; usually granted only when money damages would be an inadequate remedy and the subject matter of the contract is unique (for example, real property).

Zoning Laws

Rules and regulations that collectively manage the development and use of land.