An extensive understanding of the client's business and industry as well as knowledge of the company's operations are essential because:
A) there is a risk the business may impact the environment.
B) the increased importance of human resources has increased accounting complexity.
C) the increased importance of intangible assets has increased accounting complexity.
D) all of the above

Question

Quizplus · Accepted Answer

A) Understanding the client's business and industry is important in identifying any potential environmental risks and ensuring that the company complies with relevant regulations.
B) Knowledge of the company's operations is necessary to accurately account for human resource costs and ensure compliance with labor laws.
C) Intangible assets such as patents and trademarks can significantly impact financial statements, so it is important to understand and properly value them. Overall, a thorough understanding of the client's business and operations is crucial for effective and accurate financial reporting.

An Extensive Understanding of the Client's Business and Industry as Well