For Most Audits, a Proper Cash Receipts Cutoff Is Less

question 68

Multiple Choice

For most audits, a proper cash receipts cutoff is less important than the sales cutoff because the improper cutoff of cash

• A) is detected and correct when cash is separately audited.
• B) is unlikely to have a material impact on the balance sheet or the income statement.
• C) affects items on the balance sheet but does not affect net income.
• D) rarely occurs given the control consciousness of most entities.

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Definitions:

Personalized Power

The use of authority for personal gain, in contrast to using power primarily to achieve organizational goals or to empower others.

Narcissism

Narcissism is characterized by a grandiose sense of self-importance, a constant need for admiration, and a lack of empathy for others.

Cultural Differences

Variations in the norms, values, beliefs, and practices among people from different backgrounds or communities.

Subjectivity

The quality of being based on or influenced by personal feelings, tastes, or opinions rather than external facts.