External Auditors Have a Duty to Communicate in Writing Significant

question 9

Multiple Choice

External auditors have a duty to communicate in writing significant deficiencies in internal control to those charged with governance.Which of the following is unlikely to be relevant when determining whether a 'significant deficiency' exists?

• A)The susceptibility to loss or fraud of the related asset.
• B)The extent of substantive procedures performed.
• C)The likelihood of deficiencies leading to material misstatements in the financial statements in the future.
• D)The importance of controls to the financial reporting process.

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Definitions:

Free Flow of Information

The unrestricted exchange or transmission of data, facts, and ideas.

Government's Decisions

The conclusions or resolutions made by a government or its officials regarding policies, regulations, or actions.

Critical Thinking

The process of objectively analyzing and evaluating an issue or situation in order to form a judgment.

Reflect

To think deeply or carefully about something, often considering its implications or examining one's own thoughts and feelings.