STATEMENT ON AUDITING PROCEDURE
Purpose of the Statement
1. Long-term investments constitute a substantial portion of the assets of a number of enterprises, and are particularly signifi-cant for investment and holding companies, such as small busi-ness investment companies and bank holding companies. Matters relative to auditing long-term investments therefore are of major interest to the profession. The purpose of this statement is to furnish some guides in applying generally accepted auditing standards to examinations of the financial statements of companies with such investments. These investments may be represented by capital stock and other equity interests, bonds and similar debt obligations, and loans and advances that are in the nature of investments. The statement is concerned mainly with evidential matter corroborating both the amounts at which long-term in-investments are stated in the financial statements and the re-lated disclosures.
Objective of Examination
2. The independent auditor should ascertain whether the long-term investments are stated on a basis that conforms with
Issued by the Committee on Auditing Procedure American Institute of Certified Public Accountants
COPYRIGHT 1965 BY THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS, INC.
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