Which of the Following Statements Regarding the Use of External

question 442

Multiple Choice

Which of the following statements regarding the use of external contracted services by the chief audit executive (CAE) is false?

• A) The CAE's responsibility is not impaired by engaging an external expert.
• B) The external expert could have a prior relationship with the audit client.
• C) The audit report should not disclose the use of contracted services.
• D) The expert should be directed by the objectives and scope of work.

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Definitions:

Depreciated

Depreciation refers to the accounting practice of spreading out the expense of a physical asset over the duration of its expected lifespan.

Tax Purposes

Considerations or actions taken within financial contexts to optimize tax liability, including strategies for deductions, credits, and structuring transactions.

CCA Rate

Refers to the Capital Cost Allowance rate, which is used in taxation to represent the annual depreciation expense of a physical asset's cost.

NPV

Net Present Value, a financial metric that calculates the difference between the present value of cash inflows and the present value of cash outflows over a period of time.