Pervasive factors that might motivate management to misstate purchases process assertions include _______.
A)pressure to understate expenses in order to report achieving announced profitability targets or industry norms, which were not achieved in reality
B)pressure to understate payables in order to report a higher level of working capital when the entity is experiencing liquidity problems
C)pressure to understate payables in order to report a higher level of working capital when the entity is experiencing going concern doubts
D)All of these answer choices are correct

Question

Quizplus · Accepted Answer

All of the answer choices could motivate management to misstate purchases process assertions. Pressure to meet profitability targets or industry norms could lead to understating expenses. Pressure to report higher working capital could lead to understating payables in both liquidity problems and going concern doubts situations.

Pervasive Factors That Might Motivate Management to Misstate Purchases Process