Multiple Choice Quiz with Instructions

Conducting Compilation

• When conducting a compilation, a practitioner should obtain an understanding of the client's industry, business, and financial position.
• The practitioner should also understand the accounting principles and practices of the industry and the client's financial reporting framework.

Compiled Financial Information

• The compiled financial information is not materially misstated if it is free from material errors, omissions, and misstatements.
• The practitioner should ensure that the financial information is presented in accordance with the applicable financial reporting framework.

Proposing Amendments

• A practitioner should refrain from proposing any amendments to management if the financial information is materially misstated.
• The practitioner should discuss the matter with management and consider whether it is appropriate to withdraw from the compilation engagement.

Basis for Financial Information

• The basis for the financial information should be the client's underlying accounting records and other relevant data.
• The practitioner should not prepare the underlying records, but rather use the client's existing records to compile the financial information.