If Financial Statements Contain a Departure from GAAP,a CPA Is

question 13

Multiple Choice

If financial statements contain a departure from GAAP,a CPA is:

• A) Not allowed to issue an audit report concerning the statements
• B) Required to disclose an estimate of the approximate financial impact that the departure from GAAP had on the financial statements
• C) Allowed to complete the current-year engagement only if the financial statements are utilized by company management for internal decision-making
• D) Required to withdraw from future-year engagements, but may complete the current-year assignment as long as the departure from GAAP is adequately disclosed

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Definitions:

Average Rate

Typically refers to the mean rate or typical value for a given measure over a set time period or dataset.

Returns

The gain or loss on an investment over a specified period, typically expressed as a percentage of the investment's initial cost.

Years

Units of time representing a period of approximately 365 days or 12 months, commonly used to measure durations and intervals in financial contexts.

Real Rate of Return

The annual percentage return realized on an investment, which is adjusted for changes in prices due to inflation or other external effects.