Why Might the Decisions About Materiality and Risks Be Different

question 21

Multiple Choice

Why might the decisions about materiality and risks be different for the internal auditor than for the external auditor when conducting an audit of a system?

• A)The auditors are applying different skills during the conduct of the audit.
• B)External auditors have different expectations with respect to quality control.
• C)Internal auditors focus only on the potential for dollar errors internally.
• D)External users may have different needs than management.

Grasp the essentials of sole proprietorship, including advantages and limitations.

Recognize the distinct aspects and legal requirements of limited liability partnerships (LLPs).

Understand the formation and operational mechanisms of a limited liability company (LLC).

Understand and apply basic principles of ratio and proportion.

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Definitions:

Private Market

A market in which transactions occur directly between private sector buyers and sellers without significant government regulation or intervention.

Marginal Social Benefit

The additional benefit to society as a whole from producing or consuming one more unit of a good.

Public Good

A product or service that is provided without profit to all members of a society, either by the government or a private individual or organization, characterized by non-excludability and non-rivalry.

Marginal Social Cost

The total cost to society of producing an additional unit of a good or service.