When Obtaining Evidence Regarding Litigation Against a Client, the Auditor

question 18

Multiple Choice

When obtaining evidence regarding litigation against a client, the auditor would be least interested in determining:

• A)an estimate of when the matter will be resolved.
• B)the period in which the underlying cause of the litigation occurred.
• C)the probability of an unfavourable outcome.
• D)an estimate of the potential loss.

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Definitions:

Nondeclarative Memory

A type of long-term memory that doesn’t require conscious thought to recall, such as skills and conditioned responses.

Phi Phenomenon

An optical illusion of perceived motion created by the successive presentation of static images.

Chunking Effect

A cognitive strategy that involves breaking down information into smaller, manageable units or chunks to improve memory and learning efficiency.

Recency Effect

The tendency to remember the most recently presented information better than information that was presented earlier.