If the Auditor Is Unable to Determine the Effect of a Subsequent

question 85

True/False

If the auditor is unable to determine the effect of a subsequent event on the effectiveness of internal control at year-end, the auditor must give an adverse opinion on internal control over financial reporting.

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Definitions:

Standard Deviation

A statistical measure of the dispersion or variability of a set of numbers, indicating how spread out the numbers are from the mean.

Expected Return

The weighted average of all possible returns from an investment, where each return is weighted by its probability of occurring.

Real Estate Project

An initiative involving the purchase, improvement, management, or sale of property assets for the purpose of generating profits or revenue.

Risk-Free Asset

An investment that is expected to return its original value without any loss, theoretically free from default risk.