Which One of the Following Is Not Among the Conditions

question 28

Multiple Choice

Which one of the following is not among the conditions that give rise to a demand by external users for independent audits of financial statements?

• A) remoteness of users
• B) complexity of subject matter
• C) the securities acts, administered by the SEC
• D) potential conflict of interest between users and preparers of the statements
• E) consequence for making decisions

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Definitions:

Larger Organization

Refers to a business or entity that operates on a significant scale, having extensive reach, resources, personnel, and complexity.

Classical Approach

A theory of management that emphasizes a structured, formal organization and the importance of efficiency and productivity.

Scientific Management

A theory of management that analyzes and synthesizes workflows to improve economic efficiency, especially labor productivity.

Bureaucratic Organization

A structured and formal organization where rules, hierarchical structure, and detailed procedures guide operations and decision-making.