Consumers Union is a nonprofit organization that providesinformation and counsel on consumer goods and services. A major part of its functionis the testing of different brands of consumer products that are purchased on the openmarket and then the reporting of the results of the tests in Consumer Reports, a monthlypublication. Examples of the types of products it tests are middle-sized automobiles,residential dehumidifiers, flat-screen TVs, and boys’ jeans.a. In what ways are the services provided by Consumers Union similar to assuranceservices provided by CPA firms?b. Compare the concept of information risk introduced in this chapter with the information risk problem faced by a buyer of an automobile.c. Compare the four causes of information risk faced by users of financial statements asdiscussed in this chapter with those faced by a buyer of an automobile.d. Compare the three ways users of financial statements can reduce information riskwith those available to a buyer of an automobile.
Consumers Union is a nonprofit organization that provides
information and counsel on consumer goods and services. A major part of its function
is the testing of different brands of consumer products that are purchased on the open
market and then the reporting of the results of the tests in Consumer Reports, a monthly
publication. Examples of the types of products it tests are middle-sized automobiles,
residential dehumidifiers, flat-screen TVs, and boys’ jeans.
a. In what ways are the services provided by Consumers Union similar to assurance
services provided by CPA firms?
b. Compare the concept of information risk introduced in this chapter with the information risk problem faced by a buyer of an automobile.
c. Compare the four causes of information risk faced by users of financial statements as
discussed in this chapter with those faced by a buyer of an automobile.
d. Compare the three ways users of financial statements can reduce information risk
with those available to a buyer of an automobile.
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