Q11 Which of the following best describes the reason why independent auditors report on financial statements?   a. management fraud may exist and it is more likely to be detected by independent auditors. b. Different interests may exist between the company preparing the statements and the persons using the statements. c. A misstatement of account balances may exist and is generally corrected as the result of the independent auditors' work. d. Poorly designed internal control may be in existence.

Q: Distinguish between fraudulent financial reporting and misappropriation of assets. Discuss the…

A: Fraudulent financial reporting generally occurs when there is some international misrepresentation…

Q: whether there is a reasonable possibility that the company's internal control system will fail to…

A: Internal control is the managements’ effective and efficient controls for achieving goals and…

Q: The risk that a client's financial statements are susceptible to material misstatements is a.…

A: SOLUTION- INHERENT RISK IS THE RISK POSED BY AN ERROR OR OMISSION IN A FINANCIAL STATEMENT DUE TO A…

Q: Which of the following fraudulent activities most likely could be perpetrated due to the lack of…

A: The auditor Is responsible for forming an opinion on the financial statement and the main reason for…

Q: Which one of the following is not an advantage of internal controls? Select one: a. It safeguards…

A: Internal control is an auditing and accounting tool that ensures operational efficiency and…

Q: With respect to fraudulent financial reporting, which one of the following statements is not…

A: Auditor can obtain reasonable assurance only, not an absolute assurance.

Q: What role does the rationalization phase play in the process of financial statement fraud? A)…

A: Financial statement fraud refers to the deliberate manipulation, misrepresentation, or alteration of…

Q: Which sentence below is true about audit risk:  A. Audit risk is the risk that a company may hire…

A: Auditing means the independent checking of company operation by outsider. Auditor is  qualified and…

Q: What is the ethical value of applying the Fraud Triangle to assess the risk of material…

A: Fraud Triangle:   A fraud triangle refers to a framework that is used in auditing to explain the…

Q: Which of the following factors creates an opportunity for fraud to be committed in an organization?

A: Corporate fraud consists of illegal, deceptive actions committed either by a company or an…

Q: What fraud detection responsibilities (if any) does SOX impose on auditors?

A: Definition: Sarbanes Oxley Act: In order to protect the rights of an investor from fraudulent…

Q: Which of the following controls can minimize the threat of inaccurate financial statements? Backup…

A: Financial statements are formal records that present the financial activities and position of a…

Q: The following are examples of circumstances that may indicate the possibility that the financial…

A: Audit is the process of checking and verifying financial statements of the business so that it can…

Q: Which of the following is not an underlying principle related to risk assessment? OA. The…

A: An auditor is referred to a professional who is responsible to verify the financial statements of a…

Q: Which of the following actions did the Treadway Commission recommend to reduce fraudulent financial…

A: Option (a) It recommends creating an organizational environment that helps the integrity of the…

Q: primary difference between fraud and error in financial reporting

A: