When Determining the Inherent Risk Related to an Account Balance

question 14

Multiple Choice

When determining the inherent risk related to an account balance, an auditor theoretically does not explicitly consider the:

• A)liquidity of the account.
• B)degree of management estimation involved in determining the proper account balance.
• C)related internal control policies and procedures.
• D)complexity of calculations involved.

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Definitions:

Portal System

Pathway of blood flow that begins and ends in capillaries, such as the portal system located between the small intestine and liver.

Peptide Hormones

Short strings of amino acids that act as signaling molecules, regulating physiological processes in the body.

Cyclic AMP

Cyclic AMP (cAMP) is a second messenger important in many biological processes, transmitting the effects of hormones like adrenaline and glucagon at the cellular level.

Oxytocin

A hormone and neurotransmitter involved in childbirth and lactation, also associated with empathy, trust, sexual activity, and relationship-building.