Scenario - The Williams Company
Based in South Dakota,USA,the Williams Company has been in operation since 1967.It has five branches located in China,Europe,South America,Mexico,and Canada.Its exquisite product line of fine custom-made jewelry is highly desired throughout the world.This company has maintained a very healthy balance sheet.
The Williams Company is known within the industry for integrity and fair business practices.This company maintains an accounting system that is open for any stakeholder to view.It prides itself on being honest and trustworthy.The company feels it is this honesty in business practice that has led it to be a billion dollar organization.
-The Williams Company places a high value on maintaining integrity in its operations.Part of ensuring this integrity is maintained involves having frequent audits of the company's accounting records performed.Which one of the following would not be considered an objective of a financial statement audit?

Question

Quizplus · Accepted Answer

Ensuring dividends are allocated for stakeholders is not an objective of a financial statement audit. The purpose of a financial statement audit is to provide assurance that the financial statements are free from material misstatement and accurately reflect the financial position, performance, and cash flows of the company. Dividend allocation is a decision made by the company's management and is not directly related to the accuracy of the financial statements.

Scenario - the Williams Company