To make sure that managers have followed GAAP rules in producing financial statements, all public companies must: Multiple Choice hire independent auditors to scrutinize their financial records hire independent detectives to scrutinize the background of all their accountants. let the government reg! scrutinize their financial records regulators let their sha shareholders check their financial records.

Question

To make sure that managers have followed GAAP rules in producing financial statements, all public companies must: Multiple Choice hire independent auditors to scrutinize their financial records hire independent detectives to scrutinize the background of all their accountants. let the government reg! scrutinize their financial records regulators let their sha shareholders check their financial records.

Answer 1

The correct answer is **hire independent auditors to scrutinize their financial records.**Publicly traded companies are required by law to have their financial statements audited by an independent certified public accountant (CPA). This is a key component of corporate governance and ensures that the information presented to investors is reliable and follows Generally Accepted Accounting Principles (GAAP). The auditors provide an independent opinion on the fairness and accuracy of the financial statements.

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