Risks Associated with Specific Industries May Affect the Auditor's Assessment

question 20

Multiple Choice

Risks associated with specific industries may affect the auditor's assessment of client business risk and acceptable audit risk,and even influence client acceptance decisions.Which of the following businesses would be the most risky for the auditor to accept as a new client?

• A)a small manufacturer of metal and plastic parts that has steady profits and has been in business for 15 years
• B)a client who is developing a computer game that is expected to be ready in three years and has no other products
• C)a retail company in the clothing industry that has mid-range pricing and appeals to a large population sector
• D)a firm consisting of a partnership of ten lawyers that operates out of three different cities in one province

Appreciate the advantages and challenges of franchising for business expansion.

Gain insights into taxation and financial implications for different business types, including the concept of double taxation for corporations.

Understand the role and implications of corporate leadership structures.

Analyze the suitability of joint ventures for international business.

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Definitions:

Dozen Oysters

A quantity of twelve oysters, often used as a standard unit of sale in seafood markets.

Total Utility

The total satisfaction received from consuming a particular amount of goods or services.

Beers

Alcoholic beverages made from yeast-fermented malt flavored with hops.

Day

A period of 24 hours from midnight to midnight, representing one rotation of the Earth on its axis.