The Most Common Case in Which Conditions Beyond Both the Client's

question 17

Multiple Choice

The most common case in which conditions beyond both the client's and the auditor's control cause a scope limitation is an engagement:

• A) agreed upon after the client's balance sheet date.
• B) where the auditor doesn't have enough staff to satisfactorily audit all of the client's foreign subsidiaries.
• C) where the client is going through bankruptcy.
• D) where the client won't allow the auditor to confirm receivables for fear of offending its customers.

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Definitions:

Duress

A situation where a person is compelled to perform an act or enter into a contract under threat of violence, harm, or undue pressure.

Doctrine

A system of principles or tenets adopted and propagated by a religious organization, political entity, or similar body.

Consent

Agreement or permission given by a person with full understanding of the facts and implications of an action or decision.

Creditor Beneficiary

A third party that benefits from a contract, especially one to whom a debtor owes a payment or performance.