Reportable Conditions Are Matters That Come to an Auditor's Attention

question 110

Multiple Choice

Reportable conditions are matters that come to an auditor's attention, which should be communicated to an entity's audit committee because they represent:

• A) significant deficiencies in the design or operation of the internal controls.
• B) intentional attempts by client personnel to limit the scope of the auditor's field work.
• C) flagrant violations of the entity's documented conflict- of- interest policies.
• D) material irregularities or illegal acts perpetrated by high- level management.

Identify transactions that affect the financial statements and how they influence specific ratios.

Understand the components and preparation of a multiple-step income statement.

Analyze the effects of sales, expenses, and transactions on net income, gross profit, and stockholders' equity.

Understand cash flow statement components and what constitutes an operating activity.

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Definitions:

Post-only Design

A research design involving measurements taken only after an intervention, with no pre-test comparison.

Cognitive Variables

Factors related to mental processes of perception, memory, judgment, and reasoning, as affecting learning or behavior.

Reaction Measures

Evaluation tools used to gauge immediate responses or feedback to training or learning activities.

Literature

Written works, especially those considered of superior or lasting artistic merit, encompassing fiction, non-fiction, poetry, and other forms.