Which of the Following Statements Is Generally Correct About Audit

question 42

Multiple Choice

Which of the following statements is generally correct about audit evidence?

• A) The auditor's direct personal knowledge, obtained through observation and inspection, is more persuasive than information obtained indirectly from independent outside sources.
• B) To be appropriate, audit evidence must be sufficient.
• C) Accounting data alone may be considered sufficient appropriate audit evidence to issue an unqualified opinion on financial statements.
• D) Appropriateness of audit evidence refers to the amount of corroborative evidence to be obtained.

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Definitions:

Annual Reports

Comprehensive reports on a company's activities throughout the preceding year, intended to give shareholders and other interested parties information about the company's financial performance.

Footnotes

Additional information provided in financial statements to clarify figures or add context for readers.

Cost Method

A valuation approach in accounting that assigns the initial purchase price to inventories or investments.

Treasury Stock

Shares of a company's own stock that it has reacquired from shareholders, but not retired, and are available for reissuance or other corporate uses.