When an Auditor Informs the Client's Audit Committee of an Illegal

question 97

True/False

When an auditor informs the client's audit committee of an illegal act discovered during an audit, it is acceptable for this communication to be either oral or written.

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Definitions:

Profit Centers

Divisions or segments within a company that are directly responsible for generating profits, evaluated based on their performance.

Net Income

The remaining profit after deducting all expenses, taxes, and costs from the total revenue.

Service Department Cost

Expenses associated with the functions that support the production or selling activities of a business, such as maintenance, cleaning, and security services.

Macro Division

A segment within a company or industry that focuses on the broad, overall management and strategies rather than individual components or products.