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If the Auditor Decides to Draw Attention to Large Related

question 5

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If the auditor decides to draw attention to large related party transactions occurring in the financial statements of the client,which report will most likely be issued?


Definitions:

Post-closing Trial Balance

A financial statement prepared after closing entries are made, listing all the account balances to check the equality of debits and credits.

Accounting Cycle

The accounting process that begins with analyzing and journalizing transactions and ends with the post-closing trial balance.

Financial Statements

Formal records that convey the business activities and financial performance of a company, including balance sheet, income statement, and cash flow statement.

Closing Entries

These are journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts.

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