When Assessing the Risk of Material Misstatement, Auditors Evaluate the Reasonableness

question 36

Multiple Choice

When assessing the risk of material misstatement, auditors evaluate the reasonableness of an entity's accounting estimates. An auditor normally would be concerned about assumptions that are:

• A)susceptible to bias.
• B)consistent with prior periods.
• C)insensitive to variations.
• D)similar to industry guidelines.

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Definitions:

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