Which of the Following Procedures Would an Auditor Most Likely

question 60

Multiple Choice

Which of the following procedures would an auditor most likely include in the initial planning of a financial statement audit?

• A)Perform detailed testing of the individual balance sheet accounts.
• B)Examining documents to detect illegal acts having a material effect on the financial statements.
• C)Considering whether the client's accounting estimates are reasonable in the circumstances.
• D)Determining the extent of involvement of the client's internal audit function.

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Definitions:

Pooled Estimator

A statistical method that combines multiple estimates to produce a better overall estimate.

Variance

The square of the standard deviation, representing the average of the squared differences from the mean, and measures the spread of a data set.

Standard Deviation

A statistic that measures the dispersion or variation of a set of values from its mean, indicating how spread out the values are.

Margin of Error

The maximum amount by which the sample results are expected to differ from the true population value.