The financial statements may not correctly reflect accounting frameworks such as AAP or IFRS if the:
A) controls affecting the reliability of financial reporting are inadequate.
B) company's controls do not promote efficiency.
C) company's controls do not promote effectiveness.
D) company's controls do not promote compliance with applicable rules and regulations.

Question

Quizplus · Accepted Answer

The reliability of financial reporting is directly affected by the effectiveness of controls. If controls are inadequate, the financial statements may not accurately reflect accounting frameworks such as AAP or IFRS. Choices B, C, and D relate to different aspects of control effectiveness but are not directly relevant to the accuracy of financial reporting.

The Financial Statements May Not Correctly Reflect Accounting Frameworks Such