In the case of Equity Funding,the audit client:
A)Fraudulently recorded inventories that did not in fact exist
B)Inflated its earnings by recording fictitious sales of insurance policies
C)Moved liabilities off the balance sheet by using thousands of subsidiaries
D)Recorded inventory below cost,therefore understating costs of goods sold and overstating net income

Question

Quizplus · Accepted Answer

Equity Funding inflated its earnings by recording fictitious sales of insurance policies. This was a major aspect of the accounting fraud that was committed by the company.

In the Case of Equity Funding,the Audit Client