• 1 Marks

AAA – Nov 2011 – L3 – SA – Q11 – Assurance Engagements

Identifies an item that may be excluded from an accountant’s report in a prospectus.

The accountants’ report in a prospectus may not contain ONE of the following items:

  • A. Summarised balance sheet of the company for the last five years
  • B. Evaluation of quoted and unquoted investments
  • C. Principal accounting policies
  • D. Movement in share premium account
  • E. Particulars of preliminary expenses

B

Explanation: The answer is B. Evaluation of quoted and unquoted investments. While a prospectus may include historical financial data, accounting policies, and details on share premium and preliminary expenses, an evaluation of investments is not typically included, as it is not within the scope of an accountant’s report in a prospectus. Investment evaluation is usually a matter for financial analysis rather than mandatory reporting in a prospectus.

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