FSA day1

Which of the following least likely describes the role of financial statement analysis?

• A. Forecast the operating performance of listed companies in the next fiscal year

• B. Evaluate whether the business performance meets the expectation of shareholders

• C. Prepare financial statements to help investors make economic decisions

A listed company’s significant accounting choices (policies, methods, and estimates) are most likely to be discussed in the:

• A. footnotes to the financial statements.

• B. management discussion and analysis.

• C. auditor’s report.

Which of the following least likely describes the role of financial statement analysis?

• A. Forecast the operating performance of listed companies in the next fiscal year

• B. Evaluate whether the business performance meets the expectation of shareholders

• C. Prepare financial statements to help investors make economic decisions

Which of the following is least likely to be found in an auditor’s report under U.S. GAAP?

• A. Reasonable assurance that there are no material errors in the financial statements

• B. An opinion on the company's internal controls

• C. Assurance that the management is capable of running the business

An unqualified audit opinion:

• A.provides absolute assurance about the accuracy or precision of the financial statements.

• B.states that the financial statements are fairly presented in accordance with applicable accounting standards.

• C.is issued when the financial statements materially depart from accounting standards and are not fairly presented.

Unaudited financial statements are most likely presented in a(n):

• A.annual report.

• B.quarterly report.

• C.proxy statement.

An analyst gathers the following information (in € thousands) about a company:

Begining retained earinings=1500

Ending retained earning=2000

Dividends declared and paid=400

If there are no other items affecting shareholders' equity, net income (in € thousands) is:

• A.100

• B. 500

• C. 900