Silka Is in the Process of Performing an Audit

question 37

Multiple Choice

Silka is in the process of performing an audit.During the audit,Silka decided to change materiality.A valid reason for this would be

• A)a new user of the financial statements was identified.
• B)a fraud was discovered in the accounts payable section.
• C)materiality required the auditors to perform too many tests.
• D)too many errors were found during testing.

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Definitions:

Perceived Environment

An individual's subjective interpretation and awareness of their surrounding conditions, including social, physical, and organizational aspects.

Strategy Formulation

The process of determining the best courses of action for achieving long-term organizational objectives and competitive advantage.

Division of Labour

The assignment of different parts of a manufacturing process or task to different individuals in order to improve efficiency and productivity.

Vertical Dimension

Pertains to the hierarchical structure within organizations or systems, indicating levels of authority or rank from lower to higher.