Which of the Following Is Not a Risk Factor That

question 116

Multiple Choice

Which of the following is not a risk factor that the auditor should take into account when considering the possibility of misappropriation of assets at an audit client?

• A) The presence of inventory items which are large in size and low in value
• B) Employees with access to cash who have adverse relationships with management
• C) The audit client announces required layoffs six months from now
• D) An approved vendor list to detect unauthorized or fictitious vendors is not properly controlled

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Definitions:

Unconsciously Competent

Describes a level of skill mastery where an individual executes tasks with high proficiency without conscious effort or attention.

Direct Reports

Employees who report directly to a manager or supervisor, indicating a direct line of authority and responsibility in the organizational hierarchy.

Conscious Incompetence

Awareness of one's lack of knowledge or ability in a certain area, recognizing the need for improvement.

Plasma Membrane

Cell membrane that encloses the cytoplasm; separates a cell from its external environment.