Why is it the client's decision to record adjustments to the financial statements?
A)Having auditors adjust the financial statements would impair independence with respect to the client.
B)The financial statements are the responsibility of the client's management.
C)Auditors often do not have sufficient client-specific expertise to record adjustments to the financial statements.
D)The client will ultimately suffer any losses related to misstated financial statements.

Question

Quizplus · Accepted Answer

The financial statements are the responsibility of the client's management, therefore it is ultimately their decision to record adjustments. Auditors should recommend adjustments and provide supporting evidence to the client, but the decision to accept or reject the recommended adjustments rests with management. This ensures that the client takes ownership of the financial statements and is accountable for their accuracy.

Why Is It the Client's Decision to Record Adjustments to the Financial