When Auditing for Fraud the Auditors Should Do All of the Following

question 28

Multiple Choice

When auditing for fraud the auditors should do all of the following except:

• A) consider any unusual or unexpected relationships that have been identified in performing analytical procedures.
• B) conduct a brainstorming session to discuss the risk of fraud.
• C) only investigate areas where all three fraud risk factors are present.
• D) examine journal entries and other adjustments for evidence of possible material fraud.

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Definitions:

Net Assets

The difference between total assets and total liabilities, representing the owner's or shareholders' equity in a company.

Ownership

The legal right of possessing, using, and disposing of something, especially property or goods.

Voting Shares

Shares that give the shareholder the right to vote on company matters, such as electing directors and approving major company decisions.

Net Assets

represent the residual interest in the assets of an entity after deducting its liabilities.