Which of the Following Has Contributed to a Decrease in Federal

question 35

Multiple Choice

Which of the following has contributed to a decrease in federal class actions involving audit firms as co-defendants over the last decade?

• A)Supreme Court decisions in Janus Capital Group,Inc. ,and Stoneridge Investment Partners.
• B)Federal restrictions on contingent fees for lawyers in lawsuits filed under the Securities Act of 1934.
• C)A growing expectations gap causing investors to view audit reports as insurance against losses.
• D)All of the above.

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Definitions:

Operating Activity

Transactions and other events that affect the net income of a business, typically from primary business operations.

Statement of Cash Flows

A document that outlines the effects of changes in accounts on the balance sheet and revenue on cash and cash equivalents, categorized by operating, investing, and financing actions.

Financial Statement

Documents that provide an overview of a company’s financial condition, including balance sheet, income statement, and cash flow statement.

Cash Receipts

The collection of cash during a specific period, often recorded in financial accounting to track the inflow of cash.