Last Updated on February 2, 2022 by Admin 3
- Describes the differences between a projection and a forecast.
- Identifies the accounting principles used by management.
- Expresses limited assurance that the actual results may be within the projection’s range.
- Describes the limitations on the projection’s usefulness.
Explanation:
Choice “D” is correct. The report on compiled projected financial statements should include a separate paragraph that describes the limitations on the usefulness of the presented statements.
Choice “A” is incorrect. The accountant’s report on a compilation of a forecast or a projection does not describe
the differences between them.
Choice “B” is incorrect. The report would not identify the accounting principles used by management.
Choice “C” is incorrect. A report on compiled projected financial statements does not express any assurance regarding the achievability of results.
- AUD CPA : All Parts
Nội dung chính
- 0 Discussions
- Trending Exams
- When an accountant compiles projected financial statements the accountant's report should include?
- What disclosures should be included when preparing prospective financial statements?
- What does prospective financial information not include?
- Which of the following should not be included in an accountant's standard report based upon the compilation of an entity's financial statements?
AUDITING THEORY
1.Which of the following is a prospective financial information for general use upon which
an accountant may appropriately report?
A. Financial projection
B. Partial presentation
C. Pro forma financial statement
D. Financial forecast
2.The following statements relate to the examination of prospective financial information.
Which is false?
A. The auditor should express an opinion as to whether the results shown in the
prospective financial information will be achieved.
B. Before accepting an engagement to examine prospective financial information, the
auditor should consider the intended use of the information.
C. The auditor should not accept, or should withdraw from, an engagement to examine
prospective financial information when the assumptions are clearly unrealistic.
D. When in the auditor’s judgment an appropriate level of satisfaction has been obtained,
the auditor is not precluded from expressing positive assurance regarding the
assumptions.
3.When an accountant examines prospective financial statements, the accountant’s report
should include a separate paragraph that
A. Contains an opinion as to whether the prospective financial statements are
properly prepared on the basis of the assumptions and are presented in accordance
with generally accepted accounting principles in the Philippines.
B. Provides an explanation of the differences between an examination and an audit.
C. States that the accountant is responsible for events and circumstances up to 1 year after
the report’s date.
D. Disclaims an opinion on whether the assumptions provide a reasonable basis for the
prospective financial statements.
4.A financial forecast consists of prospective financial statements that present an entity’s
expected financial position, results of operations, and cash flows. A forecast
A. Is based on the most conservative estimates.
B. Present estimates given one or more hypothetical assumptions.
C. Unlike a projection, may contain a range.
CPA Auditing and Attestation
You can start the exam to practice all questions related to this exam.
Question No. 1
Choose the correct option from the given list.
Describes the limitations on the usefulness of the presentation.
Provides an Explanation: of the differences between an examination and an audit.
States that the accountant is responsible for events and circumstances up to one year after the report's date.
Disclaims an opinion on whether the assumptions provide a reasonable basis for the projection.
0 Discussions
Trending Exams
Recommended textbook solutionsAccounting: What the Numbers Mean
9th EditionDaniel F Viele, David H Marshall, Wayne W McManus
338 solutions
Financial Accounting
4th EditionDon Herrmann, J. David Spiceland, Wayne Thomas
1,097 solutions
Fundamentals of Financial Management, Concise Edition
10th EditionEugene F. Brigham, Joel Houston
777 solutions
Fundamental Financial Accounting Concepts
10th EditionAlvin A Arens, Mark A Beasley, Randal J Elder
1,871 solutions
When an accountant compiles projected financial statements the accountant's report should include?
An accountant's compilation report on a financial forecast should include a statement that: There will usually be differences between the forecasted and actual results. Which of the following is a conceptual difference between the attestation standards and generally accepted auditing standards?
What disclosures should be included when preparing prospective financial statements?
5.32 When prospective financial information is presented, the following shall be disclosed: (a) the date of adoption of the underlying assumptions; (b) the extent to which actual financial results are incorporated and the period covered by those results; and (c) whether or not it is intended to update the prospective ...
What does prospective financial information not include?
Although prospective financial statements may cover a period that has partially expired, statements for periods that have completely expired are not considered to be prospective financial statements. Pro forma financial statements and partial presentations are not considered to be prospective financial statements.
Which of the following should not be included in an accountant's standard report based upon the compilation of an entity's financial statements?
Which of the following should not be included in an accountant's standard report based upon the compilation of an entity's financial statements? A statement that the accountant does not express an opinion but expresses only limited assurance on the financial statements.