Which of the Following Is Correct Concerning Required Auditor Communications

question 26

Multiple Choice

Which of the following is correct concerning required auditor communications about fraud?

• A)Fraud that involves senior management should be reported directly by the auditor to the audit committee regardless of the amount involved.
• B)Fraud with a material effect on the financial statements should be reported directly by the auditor to the Securities and Exchange Commission.
• C)Any requirement to disclose fraud outside the entity is the responsibility of management and not that of the auditor.
• D)The professional standards provide no requirements related to the communication of fraud, but the auditor should use professional judgment in determining communication responsibilities.

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Definitions:

Subclavian Veins

Large veins on either side of the body that receive blood from the arm and chest wall, transporting it back to the heart.

Embolism

Obstruction or occlusion of a vessel by a transported clot, a mass of bacteria, or other foreign material.

Floating Clot

A blood clot that moves through the bloodstream, potentially causing blockages in blood vessels.

Viscosity

A measure of a fluid's resistance to flow, describing how thick or sticky the fluid is and how easily it pours at a specific temperature.