An Audit Firm Will Test the Pension Obligation of a Client

question 57

Multiple Choice

An audit firm will test the pension obligation of a client by performing which of the following procedures?

• A)calculating the actuarial assumptions and providing a journal entry.
• B)evaluating the actuary's independence and competent and sufficiency of the evidence..
• C)asking the client to adjust the long-term discount rate to smooth expenses.
• D)taking a sample of employees,tracing estimated lives to death certificates.

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Definitions:

Association

pertains to a group of individuals or organizations that come together with a common purpose or interest.

Influential Union

A labor union that has considerable impact or sway over labor relations, policies, and practices within its industry or more broadly.

Government-Controlled

Refers to entities or sectors managed or regulated by the government rather than private individuals or organizations.

Voluntarism

The principle or practice of engaging in voluntary actions or services, often without financial compensation.