Which of the following statements is true of the generally accepted auditing standards (GAASs)?
A) These standards are set by the International Accounting Standards Board (IASB).
B) The International Accounting Standards are replacing GAAS.
C) They set forth rules for how corporations and accounting firms declare accounts on the corporation's financial statements.
D) They require sufficient evidence to afford a reasonable basis for issuing an opinion on the financial statements under audit.

Question

Quizplus · Accepted Answer

GAASs are a set of standards that auditors in the United States must follow when conducting audits of public companies. These standards require auditors to request and obtain sufficient evidence to support their opinion on the financial statements. A is incorrect because GAASs are established by the American Institute of Certified Public Accountants (AICPA), not the IASB. B is also incorrect because the International Accounting Standards apply to accounting principles, not auditing standards. C is incorrect because the financial statements themselves are the responsibility of the company's management, not the auditor.

Which of the Following Statements Is True of the Generally