Current Professional Auditing Standards Make It Clear That Management, Not

question 135

True/False

Current professional auditing standards make it clear that management, not the auditor, is responsible for identifying and deciding the appropriate accounting treatment for contingent liabilities.

---

Definitions:

Leverage Ratio

A financial ratio that measures the amount of debt used in a company's financing structure in comparison to its equity or assets.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations.

Budget

Company’s plan for how it will raise and spend money during a given period of time.

Asset Turnover Ratio

A financial metric that measures the efficiency of a company at using its assets to generate revenue or sales.