Which of the following is NOT the responsibility of a company's directors?
Correct answer: A. Reporting to the shareholders on the accuracy of the accounts
- A. Reporting to the shareholders on the accuracy of the accounts
- B. Establishment of internal controls
- C. Keeping proper accounting records
- D. Supplying information and explanations to the auditor
Explanation
The auditor, not the directors, reports independently to shareholders on the financial statements. Directors are responsible for accounting records, internal controls, and providing the auditor with necessary information and explanations.
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About Auditing
Auditing examines accounting records and financial statements to determine whether they present a reliable and fairly stated position. The subject covers audit objectives, internal controls, audit evidence, materiality, vouching, verification, working papers, auditor independence, audit reports, and the distinction between an audit and accounting or investigation.
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