In Order for an External Auditor to Complete an Audit

question 37

Multiple Choice

In order for an external auditor to complete an audit of a public company,the entity's management must comply with all of the following except:

• A) Accept responsibility for the effectiveness of the entity's internal control over financial reporting.
• B) Evaluate the effectiveness of the entity's internal control over financial reporting using suitable control criteria.
• C) Support its evaluation with sufficient evidence, including documentation.
• D) Present an oral assessment of the effectiveness of the entity's internal control over financial reporting as of the end of the entity's most recent fiscal year.

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Definitions:

Legal Counsel

Professional legal advice or services provided by a qualified attorney or law firm.

S Corporation

A type of corporation that is eligible for, and elects, special taxation status.

Shareholders

Individuals or entities that own shares in a company, giving them partial ownership and potentially a say in company decisions depending on the type of shares held.

Sole Proprietorship

A business owned and operated by a single individual, with no legal distinction between the owner and the business entity.