Management Furnishes the Auditor with Information Concerning Litigation,claims,and Assessments

question 23

Multiple Choice

Management furnishes the auditor with information concerning litigation,claims,and assessments.Which of the following is the auditor's primary means of initiating action to corroborate such information?

• A)Request that the client's lawyers undertake a reconsideration of matters of litigation,claims,and assessments with which they were consulted during the period under examination.
• B)Request that the client's management send a letter of inquiry to those lawyers with whom management consulted concerning litigation,claims,and assessments.
• C)Request that the client's lawyers provide a legal opinion concerning the policies and procedures adopted by management to identify,evaluate,and account for litigation,claims,and assessments.
• D)Request that the client's management engage outside lawyers to suggest wording for the text of a footnote explaining the nature and probable outcome of existing litigation,claims,and assessments.

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Definitions:

Retinal Disparity

A visual cue to depth perception that arises from the slightly different images of the world seen by each of the two eyes.

Parallel Lines

Lines in a plane that never meet, no matter how far they are extended.

Unified Object

A concept or entity perceived as a whole, where all components are considered together rather than individually.

Perceiving Distance

The cognitive process of determining the distance from oneself to an object or place, often involving visual and auditory cues.