1. The financial statements of a company are the management's and NOT the auditor's. If the auditor objects to the information that management is presenting because GAAP is violated, then an exception can be issued by the auditor, BUT ONLY if management approves the issuance of an exception. Otherwise a clean, unqualified audit opinion must be issued.
True
False
2. Interim reports are unaudited financial statements normally prepared four times a year. Interim balance sheets are often NOT provided because this information is not deemed crucial over a short period of time; the income figure has much more relevance to interim reporting.
True
False
3. Analysis of the comparative balance sheet reveals a $40,000 increase in accounts payable from the previous year to the current year. This is reported in the statement of cash flows as an increase to cash.
True
False