Which of the Following Would Most Likely Be Classified as a Material

question 21

Multiple Choice

Which of the following would most likely be classified as a material weakness?

• A)Absence of appropriate separation of duties.
• B)Absence of appropriate reviews and approvals of transactions.
• C)Evidence of failure of control activities.
• D)Ineffective oversight of the financial reporting process by the company's audit committee.

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Definitions:

Depreciation

The systematic periodic transfer of the cost of a fixed asset to an expense account during its expected useful life.

Horizontal Analysis

A method of financial analysis in which items on financial statements over multiple periods are compared.

International Segments

Parts of a company that operates in different countries outside of the company's home country, often analyzed separately in financial reports to assess performance.

Segment Data

Financial information broken down into smaller units, such as product lines or geographical markets, within an organization.