Before Accepting an Engagement, the Auditor Should Evaluate Whether Other

question 49

Multiple Choice

Before accepting an engagement, the auditor should evaluate whether other conditions exist that raise questions as to the prospective client's auditability. Which of the following factors would be the least likely to cause concern about an entity's auditability?

• A) Related party transactions.
• B) Lack of audit trail.
• C) Disregard of responsibility to maintain adequate internal controls.
• D) Important evidence available only in electronic form.
• E) Inability to review the details supporting beginning balances.

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Definitions:

Immorally

In a way that is not conforming to accepted standards of morality, often involving actions that are ethically wrong.

Cathartic Hypothesis

The idea that expressing or venting emotions, particularly negative emotions, can lead to psychological relief.

Frustration-Aggression Hypothesis

A theory suggesting that aggression is often a result of frustration, which arises from blocked goals or desires.

Fundamental Attribution

The tendency to attribute others' actions to their character or disposition rather than to external factors.