An Auditor Concludes That a Client Has Committed an Illegal

question 264

Multiple Choice

An auditor concludes that a client has committed an illegal act that has not been properly accounted for or disclosed. The auditor should withdraw from the engagement if the:

• A) Auditor is precluded from obtaining sufficient appropriate evidence about the illegal act.
• B) Illegal act has an effect on the financial statements that is both material and direct.
• C) Auditor cannot reasonably estimate the effect of the illegal act on the financial statements.
• D) Client refuses to accept the auditor's report as modified for the illegal act.

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Definitions:

Gender Stereotypes

Overgeneralized beliefs and expectations about what men and women are like, based on traditional roles and behaviors associated with each gender.

Culture

The shared patterns of behaviors, interactions, and understanding that are learned and transmitted socially among groups of people.

Mass Media

Various forms of communication that reach a large audience simultaneously, including television, radio, newspapers, and the internet.

Sexual Orientation

A permanent, unchangeable emotional, romantic, or sexual feeling towards others that is built-in or natural.