Question

Most auditors believe that financial statements are "presented fairly" when the statements are in accordance with GAAP, and that it is also necessary to Group of answer choices determine that they are not in violation of FASB statements. assure investors that net income reported this year will be exceeded in the future. examine the substance of transactions and balances for possible misinformation. review the statements using the accounting principles promulgated by the SEC.

Answer 1

examine the substance of transactions and balances for possible misinformation.

Step-by-step explanation:

Financial accounting is an accounting technique used for analyzing, summarizing and reporting of financial transactions like sales costs, purchase costs, payables and receivables of an organization using standard financial guidelines such as Generally Accepted Accounting Principles (GAAP).

Financial statements can be defined as a document used for the formal communication or disclosure of financial information and statements to present and potential users such as investors and creditors. These includes balance sheet, statement of retained earnings and income statement.

An auditor refers to an authorized individual who review, examine and verify the authenticity and accuracy of business financial records or transactions.

Most auditors are of the opinion that financial statements are "presented fairly" when the statements are in accordance with Generally Accepted Accounting Principles (GAAP).

Additionally, most auditors believe that it is necessary to examine the substance of transactions to determine whether or not they are authentic or genuine and check the balances for possible misinformation.