The auditor must know the client's capitalisation policies to determine whether acquisitions are:
A) treated in accordance with accounting standards.
B) treated consistently with those of the preceding year.
C) both A and B
D) none of the above

Question

Quizplus · Accepted Answer

The auditor must know the client's capitalisation policies to ensure that acquisitions are treated in accordance with accounting standards and consistently with those of the preceding year. Therefore, both options A and B are correct.

The Auditor Must Know the Client's Capitalisation Policies to Determine