Regarding pension obligations and their associated auditing

Regarding pension obligations and their associated auditing issues, which of the following statements is true?

(A) The independent actuarial firm relied upon by an entity’s management provides certain assumptions, such as workforce life expectancy, which are trusted implicitly by the auditor.

(B) The findings of a specialist, such as an actuary, constitute audit evidence to be evaluated by the auditor.

(C) If all other factors remain the same, a decrease in the discount rate assumption will reduce an entity’s pension liability.

(D) Defined contribution plans require more accounting estimates than defined benefit plans.

Regarding pension obligations and their associated auditing issues, which of the following statements is true? O Defined contribution plans require more accounting estimates than defined benefit plans The findings of a specialist, such as an actuary, constitute audit evidence to be evaluated by the auditor. O The independent actuarial firm relied upon by an entity\'s management provides certain assumptions, such as workforce life expectancy, which are trusted implicitly by the auditor expectancy, whichae O If all other factors remain the same, a decrease in the discount rate assumption will reduce an entity\'s pension liability.

Solution

Ans) Option (B) The findings of a specialist, such as an actuary, constitute audit evidence to be evaluated by the auditor