A PA Recently Finished the Audit of a Family-Owned Business

question 4

Multiple Choice

A PA recently finished the audit of a family-owned business. Now she is working on a large client with about 50 times the assets and 30 times total revenue. For the larger client, the PA will likely have

• A) no changes to the audit risk model.
• B) higher control risk.
• C) higher audit risk.
• D) lower audit risk.

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Definitions:

Agricultural Economy

An economy that is primarily based on the production, processing, and trading of crops and livestock.

Thomas Jefferson

An American Founding Father who was the principal author of the Declaration of Independence and later served as the third president of the United States from 1801 to 1809.

War of 1812

A military conflict fought between the United States and the British Empire (and their respective allies) from 1812 to 1815, primarily over British restrictions on American trade and the United States' desire to expand its territory.

Louisiana Purchase

The acquisition of the territory of Louisiana by the United States from France in 1803, significantly increasing the size of the nation.