Which of the following organisations may use financial statements? 1. Australian Taxation Office 2. A church congregation 3. A university

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BlackTom AI · Accepted Answer

Question restatement: Which of the following organisations may use financial statements? 1) Australian Taxation Office 2) a church congregation 3) a university. Answer options are: A. 2 and 3 only; B. 1, 2 and 3; C. 1 and 2 only; D. 1 and 3 only.

Option A: 'A. 2 and 3 only' This option claims that only a church congregation and a university may use financial statements, excluding the Australian Taxation Office. While universities and churches commonly prepare and use financial statements for accountability and governance, the Australian Taxation Office (ATO) is a government entity that also produces financial information and reports in its annual reports and financial statements. Therefore, this option omits a valid user of financial statements.

Option B: 'B. 1, 2 and 3' This option asserts that all three entities—ATO, church congregation, and university—may use financial statements. The ATO produces and relies on financial statements for its reporting responsibilities; churches and universities also prepare financial statements for internal management, donors, regulators, and accreditation. This option aligns with the broad view that financial statements are used by a range of organisations for accountability and governance.

Option C: 'C. 1 and 2 only' This option excludes universities. While the ATO and churches do use financial statements, universities are typically required to publish audited financial statements for stakeholders and accreditation bodies. Thus, excluding universities would be inaccurate.

Option D: 'D. 1 and 3 only' This option includes the ATO and a university but excludes churches. Churches also prepare financial statements for stewardship and transparency in many jurisdictions, so omitting churches makes this option incomplete.

In summary, the reasoning shows that option B broadens the applicability to include all three types of organisations, while the other options leave out at least one valid user of financial statements. The key idea is that financial statements are used by government bodies, religious groups, and educational institutions alike for accountability and governance purposes.

Dashboard Unit 1 Non assessable Multiple Choice Questions Quiz

Which of the following organisations may use financial statements? 1. Australian Taxation Office 2. A church congregation 3. A university

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