When a Material Weakness Is Identified, the Auditor Should _______

question 93

Multiple Choice

When a material weakness is identified, the auditor should _______.

• A)presume that a material misstatement exists in the financial statements
• B)not presume that a material misstatement occurred in the financial statements
• C)immediately request the internal audit function conduct a full review of the control issue
• D)proceed with issuing an unmodified opinion

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Definitions:

Liability

The legal responsibility for one's actions or omissions, which may involve an obligation to pay damages or perform a specific duty.

Operating Agreement

A legal document that outlines the governing structure and operating guidelines of an LLC including the rights and responsibilities of its members.

Dissolution

The process of formally closing or ending a legal entity, such as a corporation or partnership.

Limited Liability Company

An entity where owners are not personally liable for company debts, offering flexibility in management and benefits of pass-through taxation.