Ethical Obligations and Decision-Making in Accounting 2nd Edition by Steven Mintz, Roselyn Morris

Exercise 5

Professor Slim Pickens makes the following statement in his Intermediate II accounting class: The standards of field work provide the foundation to ensure that the financial statements present fairly financial position and results of operations. Discuss what you think Pickens means by the statement. Why do you think he would make such a statement in an Intermediate class?

Step 1 of 3

Audit:

The audit is the process of checking the financial statements of a company `to ensure that it is 100% authentic and free from any kind of bias or fraud.

Financial statement:

The financial statement of a company is the record of past year activities. There are many financial statements like cash flow statement, balance sheet, income statement, profit and loss account, etc.