The SEC Is Concerned That Auditors Don't Pay Enough Attention

question 70

Multiple Choice

The SEC is concerned that auditors don't pay enough attention to qualitative factors affecting materiality because:

• A) Qualitative factors may cause quantitatively small misstatements to become material
• B) Quantitative factors are not always useful
• C) Quantitative factors cannot be accumulated to assess overall materiality
• D) All are of concern to the SEC

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Definitions:

Fear Appeals

A persuasion technique that involves raising alarm or concern about a potential danger to motivate specific behaviors.

Intentions

Plans or commitments to carry out an action in the future, often reflecting conscious decisions.

Informational Appeal

A communication technique that uses factual information and logical arguments to persuade or influence others' attitudes or behaviors.

Cardiovascular Exercise

Physical activity that raises the heart rate and increases blood circulation throughout the body, beneficial for heart health and endurance.