Accepting an engagement to compile a financial projection for a public company most likely would be inappropriate if the projection were to be distributed to:
A)a bank with which the entity is negotiating for a loan.
B)a labor union with which the entity is negotiating a contract.
C)the principal stockholder, to the exclusion of the other stockholders.
D)all stockholders of record as of the report date.

Question

Quizplus · Accepted Answer

Financial projections are typically intended for limited use and should not be distributed to all stockholders, as they may not have the expertise to understand the assumptions and limitations involved.

Accepting an Engagement to Compile a Financial Projection for a Public