The standard of adequate disclosure is best described by which of the following
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[Superseded, effective for audits of fiscal years beginning on or after December 15, 2010. See PCAOB Release No. 2010-004.] Show
Supersedes Statement on Auditing Standards No. 1, section 430)Source: SAS No. 32.Issue date, unless otherwise indicated: October, 1980..01The third standard of reporting is:
.02The presentation of financial statements in conformity with generally accepted accounting principles includes adequate disclosure of material matters. These matters relate to the form, arrangement, and content of the financial statements and their appended notes, including, for example, the terminology used, the amount of detail given, the classification of items in the statements, and the bases of amounts set forth. An independent auditor considers whether a particular matter should be disclosed in light of the circumstances and facts of which he is aware at the time. [The following paragraph is effective November 15, 2008. See PCAOB Release 2008-001 (January 29, 2008). For the paragraph effective before November 15, 2008, click here.] .03If management omits from the financial statements, including the accompanying notes, information that is required by generally accepted accounting principles, the auditor should express a qualified or an adverse opinion and should provide the information in his report, if practicable, unless its omission from the auditor's report is recognized as appropriate by a specific Statement on Auditing Standards. In this context, practicable means that the information is reasonably obtainable from management's accounts and records and that providing the information in the report does not require the auditor to assume the position of a preparer of financial information. For example, the auditor would not be expected to prepare a basic financial statement or segment information and include it in his report when management omits such information. [Paragraph deleted, effective November 15, 2008. See PCAOB Release 2008-001 (January 29, 2008). Click here to view the paragraph.] Chapter 3 0 ratings0% found this document useful (0 votes) 2K views5 pagesDocument Informationclick to expand document informationCopyright© © All Rights Reserved Share this documentShare or Embed DocumentSharing Options
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Home Books Audiobooks Documents What is the standard of adequate disclosure?Adequate disclosure is an accounting guideline for companies to report all essential information, including financial statements to investors. Adequate disclosure mandates that companies provide a comprehensive outlook of a company's financial position.
Which of the following best describe the concept of adequate disclosure?Answer and Explanation: The correct option is (d). The concept of adequate disclosure requires a company to inform about each and every financial transaction to the financial statement users except the projections made for income for the last five years.
What is the best way to describe disclosure?Disclosure is the process of making facts or information known to the public.
What describes inadequate disclosure?By far, the most common type of inadequate disclosure takes the form of incomplete or falsified financial documents. These could be accounting records, or they might be financial reports that are filed with the SEC and other regulatory bodies.
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