Which of the following statements is true with regards to financial statement audits?
A)The auditors guarantee that the financial statements are accurate and correct.
B)Financial audits are directed toward the discovery of fraud.
C)Auditors provide reasonable assurance that statements are free from material misstatements,whether caused by errors or fraud.
D)Auditors will not disclose information that they have acquired as a result of their accountant-client relationship.

Question

Quizplus · Accepted Answer

Auditors do not guarantee that financial statements are absolutely correct-only that they are materially correct.Financial audits are not directed toward the discovery of fraud.Auditors are,however,responsible for providing reasonable assurance that financial statements are free from material misstatements,whether caused by errors or fraud.The confidentiality rules in the code of ethics for CPAs prohibit auditors from voluntarily disclosing information they have acquired as a result of their accountant-client relationships.However,accountants may be required to testify in a court of law.

Which of the Following Statements Is True with Regards to Financial