Company XYZ Had a Long-Standing Relationship with a Leading Law

question 42

Multiple Choice

Company XYZ had a long-standing relationship with a leading law firm. In fact, the law firm's business with this company was one of its most profitable relationships. If the law firm decides that it no longer wants to conduct business with the company, this is:

• A) Indicative that the company might have a lot of customer lawsuits against it
• B) Not any sort of meaningful indicator of fraud activity
• C) A large cause for concern that financial statement fraud may be occurring
• D) An indication that the client has likely outgrown the law firm

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Definitions:

Political Factors

External Factors Including Labor Laws, Property Rights, and Patent Processes.

Economic Factors

External factors including the strength or weakness of markets, stability of trade cycles, specific industry conditions, customer preferences, and government’s economic policies.

Labor Laws

Regulations and laws that govern the rights and responsibilities of workers, employers, and labor unions to ensure fair employment practices.

Political Factors

Elements related to government actions, policies, and political stability that can influence business operations and decisions.