The First Step in the Financial Statement Audit Using a Risk

question 42

Multiple Choice

The first step in the financial statement audit using a risk assessment approach is to

• A) identify risks of material misstatement.
• B) gather evidence to assess the likelihood of material misstatement.
• C) evaluate audit evidence.
• D) evaluate the reporting framework.

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Definitions:

Global Operations

The activities of a business or organization conducted in multiple countries around the world, often involving production, distribution, and marketing.

Personal Ethics

A set of principles and moral values that guide an individual's behavior and decision-making process.

Political-risk Analysis

The assessment of the impact that political decisions, events, or conditions might have on the profitability and operation of a business.

Trompenaars' Cultural Framework

A model that categorizes cultures based on their responses to seven dimensions of human relationships and interaction.