During an audit of an entity's stockholders' equity accounts, the auditor determines whether there are restrictions on retained earnings resulting from loans, agreements, or state law. This audit procedure most likely is intended to verify management's assertion of:
A)existence or occurrence.
B)completeness.
C)valuation or allocation.
D)presentation and disclosure.

Question

Quizplus · Accepted Answer

This audit procedure is intended to verify the presentation and disclosure of the entity's stockholders' equity accounts, specifically the disclosure of any restrictions on retained earnings resulting from loans, agreements, or state law.

During an Audit of an Entity's Stockholders' Equity Accounts, the Auditor