Which of the Following Is Not a Risk Factor That

question 101

Multiple Choice

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

• A) Significant accounting estimates are not difficult for the auditor to verify and justify.
• B) Board members' personal net worth is threatened if the entity's financial performance does not meet market expectations.
• C) Increasing business complexity occurs as a result of numerous recent acquisitions.
• D) Information technology personnel are found to be not keeping up with the latest trends in internal controls and data security.

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Definitions:

Memory Retrieval

The process of recalling or bringing into consciousness information from memory storage.

Memory Encode

The process of converting information into a form that can be stored in the brain.

Flashbulb Memory

A vivid and detailed memory of an emotional or significant moment or event.

Emotionally Significant

Pertaining to events or information that have a deep emotional impact on an individual.