COST ACCOUNTING
COST ACCOUNTING STANDARDS
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Question
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Persons using accounting information who are not directly involved in the running of the organization; examples include shareholders, customers, regulators, and suppliers.
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Examine and provide assurance that financial statements are prepared according to generally accepted accounting principles (GAAP).
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Detailed explanation-1: -External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles. The business entity principle means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.
Detailed explanation-2: -Key Takeaways. Responsibility for enforcement and shaping of generally accepted accounting principles (GAAP) falls to two organizations: The Financial Accounting Standards Board (FASB) and Securities and Exchange Commission (SEC).
Detailed explanation-3: -One of the auditor’s responsibilities in an audit conducted in accordance with generally accepted auditing standards is to obtain sufficient appropriate evidential matter to provide a reasonable basis for the opinion on the entity’s financial statements.
Detailed explanation-4: -An unqualified opinion is an independent auditor’s judgment that a company’s financial statements are fairly and appropriately presented, without any identified exceptions, and in compliance with generally accepted accounting principles (GAAP).