Accounting

When contrasting a review and a compilation, which of the following is true?

*A review provides negative assurance and a compilation provides no assurance.

10. Management assertions

*implied or expressed representations about the accounts in the financial statements.

11. Management’s classifies a portion of its total debt as a current liability on the balance sheet because it will mature in the current year. This classification is

*a presentation and disclosure assertion

12. Due to unusual circumstances, Eagle Company’s financial statements contain a departure from GAAP because compliance would make the statements misleading. The auditor

*can give an unqualified opinion as long as the GAAP departure is explained in a separate paragraph

13. An auditor includes a separate paragraph in an otherwise unqualified report to emphasize that the entity being reported upon had significant transactions with related parties. This inclusion of this separate paragraph

*is appropriate and would not negate the unqualified opinion

14. An auditor may not issue a qualified opinion when \

*the auditor lacks independence with respect to the audited entity.

15. Per SAS 59, when considering management’s plans related to a going concern situation, which of the following is not a viable plan for dealing with adverse conditions and events?

*plans to increase research and development expenditures

16. Which of the following items is NOT responsibility detailed in SAS 59. “The Auditor’s Consideration of an Entity’s Ability to Continue as a Going Concern”?

*the auditor must assume responsibility for predicting future conditions or events

17. Without the consent of the client, a CPA should not disclose confidential client information contained in working papers to a

*CPA firm that purchased the CPA’s accounting practice

18. The USA Today recently reported that 2005 was a record-breaking year with respect...