Auditors May Identify Conditions During Fieldwork That Change or Support

question 24

Multiple Choice

Auditors may identify conditions during fieldwork that change or support a judgment about the initial assessment of fraud risks. Which of the following is not a condition which should alert an auditor that the initial assessment should be changed?

• A) The subsidiary ledger agrees with the general ledger.
• B) discrepancies in the accounting records
• C) unusual relationships between the auditor and management
• D) missing or conflicting evidence

---

Definitions:

Less Intelligent

A term, often considered pejorative, used to describe lower-than-average cognitive abilities or intellectual functioning.

Transference

A phenomenon in psychoanalysis in which a patient redirects feelings and desires, often unconsciously, from a person in their past to a new object, usually the therapist.

Gain-Loss Theory

A psychological concept suggesting that a person's attraction to others increases with signs of increasing interest from them, and decreases with signs of disinterest or hostility.

Halo Effect

A cognitive bias in which an observer's overall impression of a person, product, or company influences their feelings and thoughts about that entity's character or properties.