On what is a 'reporting entity',as defined in SAC 1,dependent?
A) Whether there are users that are dependent on the reports to make or evaluate resource decisions
B) Professional judgment providing some guidelines to help make a decision
C) Whether there are users that are dependent on the reports to make or evaluate resource decisions, and professional judgement provides some guidelines to help make a decision
D) The Corporations Law based on measures of gross revenue, dollar value of assets and the number of employees

Question

Quizplus · Accepted Answer

A reporting entity, as defined in SAC 1, is dependent on whether there are users that rely on the reports to make or evaluate resource decisions, and professional judgment provides some guidelines to help make a decision. The Corporations Law may be a factor in determining reporting requirements, but it is not the sole criterion. Therefore, choices A and D may be partially correct, but the most comprehensive answer is C. Choice B is incorrect as it does not consider the dependence on reports by users.

On What Is a 'Reporting Entity',as Defined in SAC 1,dependent