Which Are the Types of Misstatements Relevant to the Auditor's

question 161

Multiple Choice

Which are the types of misstatements relevant to the auditor's consideration of fraud in a financial statement audit?

• A) misstatements arising from fraudulent financial reporting
• B) misstatements arising from misappropriations of assets
• C) Both A & B
• D) Neither A nor B

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Definitions:

Limit-Sell Order

An order to sell a security at a specified price or better.

Maintenance Margin

The minimum amount of equity that must be maintained in a margin account after a purchase has been made, to continue holding the position.

Initial Margin

The percentage of the purchase price of securities (that can be bought on margin) that the investor must pay with his/her own cash or marginal securities.