Question

After the accountant of Seagal Plastics Co had prepared the financial statements for the year ended 31 December Year 8, the following errors came to light. What should be done to rectify these errors?

1) Adjust the financial statements to correct the errors
2) Ignore the errors and proceed with the current financial statements
3) Recreate the financial statements from scratch
4) Consult with a financial advisor for guidance

Answer 1

To rectify the errors, the accountant should adjust the financial statements to correct the errors.

Step-by-step explanation:

To rectify the errors discovered after the preparation of the financial statements, the accountant should adjust the financial statements to correct the errors. Ignoring the errors and proceeding with the current financial statements could lead to inaccurate and misleading information. Recreating the financial statements from scratch may not be necessary unless the errors are extensive or cannot be reasonably corrected. It is not necessary to consult with a financial advisor for guidance in this situation, as the accountant is typically responsible for correcting errors in the financial statements.