In Those Audits Where There Is a Heightened Risk of Fraud

question 12

Multiple Choice

In those audits where there is a heightened risk of fraud related to stockholders' equity accounts,which of the following will the auditor typically not perform?

• A)Confirm terms of equity arrangements and shares held directly with shareholders.
• B)Account for and vouch all proceeds from stock issues.
• C)Confirm with shareholders whether there are any side agreements.
• D)Review equity authorizations in the board meeting minutes.

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Definitions:

Epigenetics

The study of heritable changes in gene expression that do not involve changes to the underlying DNA sequence.

Nature and Nurture

The debate regarding the relative contributions of genetic inheritance (nature) and environmental factors (nurture) to human development.

Heredity

The passing on of physical or mental characteristics genetically from one generation to another.

Genes and Chromosomes

Elements of heredity with genes being the molecular units of inheritance on chromosomes, which are long strands of DNA containing a sequence of genes.