According to SAS 54, the Auditor's Responsibility for Illegal Acts

question 18

Multiple Choice

According to SAS 54, the auditor's responsibility for illegal acts having a direct and material effect on the determination of financial statement amounts is:

• A) greater than for errors or fraud.
• B) the same as it is for errors or fraud.
• C) less than it is for errors or fraud.
• D) different for direct-effect illegal acts and other types of illegal acts.
• E) restricted to information that comes to his attention.

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Definitions:

Drive Reduction

A theory in psychology that focuses on how fulfilling biological needs reduces physiological drives.

Learning

The process of acquiring new understanding, knowledge, behaviors, skills, values, attitudes, or preferences through study, experience, or instruction.

Cognitive Psychology

is the study of mental processes such as "attention, language use, memory, perception, problem-solving, creativity, and thinking."

Tolman's Theories

The psychological theories proposed by Edward C. Tolman, emphasizing the importance of cognitive processes and expectations in learning, suggesting that behavior is purposeful and goal-directed.