Why Are Related Party Transactions a Risk Area for Auditors

question 11

Multiple Choice

Why are related party transactions a risk area for auditors? They:

• A)have minimal disclosure requirements.
• B)have a higher than average risk of irregularities.
• C)have a direct impact on profit.
• D)are difficult to assess.

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Definitions:

Semimembranosus

One of the three hamstring muscles located at the back of the thigh, important for thigh extension and knee flexion.

Pronator Teres

A muscle in the forearm that helps in pronating the wrist, turning the hand so the palm faces downwards or backwards.

Buccinator

A muscle of the cheek that plays a significant role in the action of chewing and assists in manipulating food in the mouth.

Supinator

A muscle in the forearm that rotates the forearm and hand outward, as in turning the palm up.