To Emphasise Auditor Independence from Management, Many Companies

question 36

Multiple Choice

To emphasise auditor independence from management, many companies:

• A) have the independent auditor report to an audit committee of outside members of the board of directors.
• B) request that a representative of the auditor be present at the annual general meeting.
• C) appoint a member of the audit firm to the company's audit committee.
• D) establish a policy of discouraging social conduct between company employees and the staff of the audit firm.

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Definitions:

Consequent

In a conditional statement, the consequent is the outcome or result that follows from the condition being met.

Fallacy

An erroneous argument based on unsound reasoning or misleading premises.

Affirming Consequent

A logical fallacy where one incorrectly infers the cause from an effect, specifically asserting that since the consequent is true, the antecedent must also be true.

Hypothetical Syllogism

A logical argument that has two premises followed by a conclusion, each of which is a conditional statement.