Which of the Following Statements Is Correct

question 14

Multiple Choice

Which of the following statements is correct?

• A) Significant professional judgment is not necessary in deciding whether a weakness identified is significant enough to warrant communicating to management.
• B) A management letter is prepared by management.
• C) Significant professional judgment is necessary in deciding whether a weakness identified is significant enough to warrant communicating to management.
• D) All of the above.

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Definitions:

Industry Segments

Distinct subdivisions within a market, defined by products, services, or consumer demographics, enabling targeted strategies.

Profit Or Loss Test

A method used to assess the financial performance of a company by determining whether it has made a profit or incurred a loss over a certain period.

Separately Reportable

Criteria under which certain activities or financial results must be disclosed individually due to their significance within financial statements or to regulatory bodies.

Industry Segments

Specific categories within an industry that companies can be classified under based on their main business activities.