Which One of the Following Is an Example of the Concept

question 36

Multiple Choice

Which one of the following is an example of the concept of inherent risk?

• A) Accounting systems with vouchers have many more controls built in, so the risk that there will be errors on the financial statements is reduced.
• B) Loans receivable for a finance company are less likely to be collectible than those of a bank.
• C) Humans make more errors than computers; therefore, a manual accounting system is riskier than a computerised system.
• D) Audits with larger sample sizes are less risky than those with smaller sample sizes.

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Definitions:

Memory Attribute

Characteristics or features of memory, such as duration, capacity, and encoding processes, that differentiate various types of memory.

Affective Memory Attributes

Characteristics of memories that are associated with emotions, influencing how memories are processed and recalled.

Distinctiveness

The quality of being notably different or unique, often used in the context of stimuli in psychology to describe how easily an item stands out from others, facilitating learning and memory.

Interference

A cognitive process where previously learned information hinders the ability to learn new information or the recall of existing information.