When an accountant compiles a nonpublic entity's financial statements that omit substantially all disclosures required by generally accepted accounting principles, the accountant should indicate in the compilation report that the financial statements are:
A)restricted for internal use only by the entity's management.
B)not to be given to financial institutions for the purpose of obtaining credit.
C)compiled in conformity with a comprehensive basis of accounting other than generally accepted accounting principles.
D)not designed for those who are uninformed about the omitted disclosures.

Question

Quizplus · Accepted Answer

When financial statements omit substantially all disclosures required by GAAP, the accountant should indicate in the compilation report that the financial statements are not designed for those who are uninformed about such matters. This is because the lack of disclosures might mislead individuals who are not aware of the omitted information.

When an Accountant Compiles a Nonpublic Entity's Financial Statements That