Which of the Following Statements Is Correct Concerning an Auditor's

question 742

Multiple Choice

Which of the following statements is correct concerning an auditor's use of the work of a specialist?

• A) The work of a specialist who is related to the client may be acceptable under certain circumstances.
• B) If an auditor believes that the determinations made by a specialist are unreasonable, only a qualified opinion may be issued.
• C) If there is a material difference between a specialist's findings and the assertions in the financial statements, only an adverse opinion may be issued.
• D) An auditor may not use a specialist in the determination of physical characteristics relating to inventories.

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Definitions:

Accounting Policy

Own sets of beliefs, bases, manners, dictates, and systems placed by a corporation in the making and publicizing of its financial declarations.

High Leverage

A situation where a company or individual has a significant level of debt compared to equity, potentially increasing financial risk but also possible returns.

Political Costs

Expenses and impacts a company incurs as a result of political decision-making, regulations, or actions that affect its operations and profitability.