Which of the Following Requires Accountants to Use Adequate Procedures

question 79

Multiple Choice

Which of the following requires accountants to use adequate procedures so that they can detect illegal acts committed by an audited company?

• A)The Private Securities Litigation Reform Act
• B)The Fraud and Illegality Deterrence Act
• C)The Public Securities Auditing Reform Act
• D)The Accountant Crime Deterrence Act
• E)The Public Detection Act

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Definitions:

Inventory Turnover

A metric that demonstrates the frequency at which a firm's stock is sold and replenished within a certain timeframe, highlighting the effectiveness of its inventory control.

Cost of Goods Sold

Costs incurred directly from the production process of goods a company offers for sale.

Accounts Receivable

Money owed to a business by its clients or customers for goods or services delivered but not yet paid for.

LIFO Reserve

The difference between the cost of inventory calculated using the Last-In, First-Out (LIFO) method and the cost calculated using the First-In, First-Out (FIFO) method.