Which of the Following Auditor Concerns Most Likely Could Be

question 760

Multiple Choice

Which of the following auditor concerns most likely could be so serious that the auditor concludes that a financial statement audit cannot be performed?

• A) Management fails to modify prescribed internal controls for changes in information technology.
• B) Internal control activities requiring segregation of duties are rarely monitored by management.
• C) Management is dominated by one person who is also the majority stockholder.
• D) There is a substantial risk of intentional misapplication of accounting principles.

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Definitions:

Gestalt Psychologists

Psychologists who focus on how people interpret the world, emphasizing the idea that the whole is different from the sum of its parts.

Form Perception

The process by which the human brain interprets and organizes sensory information to understand its environment, particularly in recognizing shapes and patterns.

Color Vision

The ability of the eye and brain to distinguish objects based on the wavelengths (or frequencies) of the light they reflect, emit, or transmit.

Perceptual Set

A habitual way of perceiving, based on expectations.