Choose the Correct Statement About Audits of Corporations

question 46

Multiple Choice

Choose the correct statement about audits of corporations:

• A) Outside auditors are paid by the government for auditing the financial statements of corporations.
• B) Revenue Canada performs audits of corporations' financial statements.
• C) Public corporations (those whose stock are traded on exchanges) are subject to annual audit as to their compliance with GAAP.
• D) It is the employees of the firm being audited who perform the annual audit of the financial statements of that firm.

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Definitions:

Quantum Meruit

A legal principle that allows a person to recover the reasonable value of services provided, when no specific contract was made as to payment.

Equitable Estoppel

A legal principle preventing one party from taking unfair advantage of another when their prior actions or words have led to a reliance by the latter.

Consideration

A core concept in contract law that requires a bargain or something of value to be exchanged between parties for a contract to be valid.

Equitable Estoppel

A legal principle preventing someone from arguing something contrary to a claim if a previous action or agreement implied that claim.