Which of the Following Procedures Would Not Be Performed in a Review

question 38

Multiple Choice

Which of the following procedures would not be performed in a review of the financial statements of a private company?

• A)Enquire about the accounting system and bookkeeping procedures.
• B)Perform analytical procedures to identify relationships and individual items that appear to be unusual.
• C)Obtain a lawyer's letter about claims and possible claims.
• D)Study the financial statements for indications that they conform to generally accepted accounting principles.

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Definitions:

Nonrival

Refers to a good where one person's use does not reduce the amount available for others.

Nonexcludable

A characteristic of goods where it is difficult or impossible to prevent people from using the good once it has been provided.

Public Goods

Goods that are non-excludable and non-rivalrous, meaning they are available to every individual without diminishing availability to others, such as national defense, public parks, and clean air.

Marginal Social Benefit

The additional benefit that society receives from the consumption of an additional unit of a good or service.