As a CPA you have been asked to examine an entity's financial projections. Acceptance of the engagement would be appropriate if distribution is limited to

Question

Quizplus · Accepted Answer

As a CPA, the exam of an entity's financial projections is appropriate if the distribution is limited to a financial institution for which the company is negotiating a loan. It is due to the fact that the purpose of the evaluation is to verify the likelihood of a loan being repaid, and the financial institution has a legitimate interest in receiving this data. The other potential distribution options are inappropriate since stockholders, potential investors, creditors, and the general public do not have a legitimate interest in the financial projections.

As a CPA You Have Been Asked to Examine an Entity's