A Control Deficiency That Is Less Than a Significant Deficiency

question 25

Multiple Choice

A control deficiency that is less than a significant deficiency is most likely to result in what form of audit opinion on internal control?

• A)Adverse.
• B)Qualified.
• C)Unqualified.
• D)Unqualified with explanatory language.

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Definitions:

Risk-Free

Pertaining to an investment with guaranteed returns and negligible risk of financial loss.

Economic Profits

Profits or losses calculated by considering both explicit costs, such as direct expenses, and implicit costs, like opportunity costs.

Arbitrage Opportunity

The opportunity to buy an asset at a low price in one market and sell it for a higher price in another, exploiting price discrepancies.

Investment Portfolio

Set of securities chosen by an investor.