As a Result of Analytical Procedures Conducted During the Planning

question 18

Multiple Choice

As a result of analytical procedures conducted during the planning phase, the independent auditor determines that the gross profit percentage has declined from 30% in the preceding year to 20% in the current year. The auditor should:

• A)Express an opinion that is qualified due to the inability of the company to continue as a going concern.
• B)Evaluate management's performance in causing this decline.
• C)Require footnote disclosure.
• D)Consider the possibility of an error in the financial statements.

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Definitions:

Flextime

A flexible working schedule that allows employees to choose their work hours within agreed limits.

Organizational Culture

The shared values, beliefs, and practices that shape the social and psychological environment of a business or institution.

Self-Directed Team

A group of employees who are given the autonomy to manage their work and make decisions about how to achieve their goals, often without direct supervision.

Quality Improvement Team

A group of employees from various departments who are brought together to discuss and find solutions for specific quality issues within an organization.