When an accountant compiles a financial forecast,the accountant's report should include a(n):
A)Explanation of the differences between a financial forecast and a financial projection.
B)Caveat that the prospective results of the financial forecast may not be achieved.
C)Statement that the accountant's responsibility to update the report is limited to one year.
D)Disclaimer of opinion on the reliability of the entity's internal controls.

Question

Quizplus · Accepted Answer

It is important for the accountant to include a caveat that the prospective results of the financial forecast may not be achieved, as it is impossible to accurately predict future financial outcomes with certainty. This helps to manage expectations and avoid potential issues with stakeholders who may rely on the forecast. Options A, C, and D are not necessary in a financial forecast report.

When an Accountant Compiles a Financial Forecast,the Accountant's Report Should