Determining the Likelihood of a Loss Contingency Occurring and Trying

question 79

Multiple Choice

Determining the likelihood of a loss contingency occurring and trying to estimate a reasonable amount for a future loss _______.

• A)should be determined by the client's legal counsel
• B)should be determined solely by the external auditor
• C)should be determined solely by the internal auditor
• D)involves significant judgment by management

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Definitions:

Company

A legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise.

Collective Mark

A trademark or service mark used by members of a collective group to identify the services or goods they provide with a certain level of quality or accuracy.

Certification Mark

A symbol, word, or phrase legally registered or established by use as representing a company or product's certification of quality, accuracy, or origin.

Service Mark

A symbol, word, or phrase legally registered or established by use as representing a company or product in the service sector.