Which of the Following Is Not an Important Consideration in an Auditor's

question 35

Multiple Choice

Which of the following is not an important consideration in an auditor's evaluation of an entity's business risk?

• A) The specific business risks that an entity faces may result in financial report errors and fraud.
• B) Business risk factors affect the ability of an entity to be profitable and survive.
• C) Auditing standards include many entity business risk factors that identify circumstances that increase the likelihood of material misstatements.
• D) Auditing standards require the auditor to evaluate the entity's business risk in order to provide suggestions to improve the entity's profitability.

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Definitions:

Youngest Unit

The most recent geological layer, structure, or formation in a sequence of stratified rocks.

Pebble-sized Particles

Small, rounded stones or pieces of rock, typically sized between 4 and 64 millimeters in diameter.

Oldest Unit

The earliest formed part of a geological sequence, which can provide valuable information about the Earth's history.

Easy to Erode

Refers to geological materials or landforms that are readily worn away or removed by the action of water, wind, ice, or other erosional forces.