The Inclusion in the Records of a Business of Machinery

question 50

Multiple Choice

The inclusion in the records of a business of machinery that belongs to a shareholder,is an example of improper application of which financial statement assertion?

• A)Existence (occurrence)
• B)Completeness
• C)Ownership (rights and obligation)
• D)Presentation (classification and disclosure)

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Definitions:

Statement of Affairs

A statement of affairs is a financial report summarizing the assets and liabilities of a company, particularly in the context of a bankruptcy or insolvency situation.

Preliminary Report

An initial set of financial statements or findings, often not final or audited, released to provide an early indication of performance.

ASIC

The Australian Securities and Investments Commission, which acts as the financial services and markets regulator in Australia.

Insolvency

The state of being unable to pay debts owed when they are due, leading to potential bankruptcy.