Which One of the Following Discoveries by the Auditor Would

question 98

Multiple Choice

Which one of the following discoveries by the auditor would NOT raise the red flag of increased inherent risk?

• A) This is the fourth consecutive year that the firm has audited this client.
• B) Client is a parent company with a subsidiary.
• C) The client is an electronics manufacturer that is holding extensive inventory.
• D) Review of the results of the previous year's audit shows there were significant misstatements in accounts payable.

---

Definitions:

Glaucoma

A group of eye conditions that damage the optic nerve, often associated with increased pressure within the eye.

Nausea

A sensation of discomfort in the stomach with an urge to vomit, often a symptom of various conditions.

Marijuana

A psychoactive drug from the Cannabis plant, used for medical or recreational purposes.

Opiates

Drugs derived from opium, typically used for their analgesic (pain-relieving) properties; can lead to dependence and addiction.