A Positive Confirmation Is More Reliable Evidence Than a Negative

question 108

Multiple Choice

A positive confirmation is more reliable evidence than a negative confirmation because

• A) fewer confirmations can be sent out.
• B) the auditor has a document which can be used in court.
• C) the debtor's lack of response indicates agreement with the stated balance.
• D) follow-up procedures are performed if a response is not received from the debtor.

---

Definitions:

Resource Scarcities

Situations where the demand for resources exceeds the available supply, leading to potential constraints on activities or projects.

Complexity

The state of having multiple interrelated parts, leading to difficulty in understanding, prediction, or control.

Organizational Size

This refers to the magnitude of an organization, typically measured by the number of its employees, the scale of its operations, or its market share.

Adhocracy

A flexible, adaptable, and informal organizational structure that is defined by a lack of rigid procedures, roles, and hierarchies, facilitating innovation and creativity.