If an Illegal Act Is Discovered During the Audit of a Publicly-Held

question 7

Multiple Choice

If an illegal act is discovered during the audit of a publicly-held company, the auditor should:

• A)notify the regulatory authorities.
• B)determine who was responsible for the illegal act.
• C)intensify the audit.
• D)report the act to high-level personnel within the client's organisation.

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Definitions:

Deadweight Loss

A loss of economic efficiency that can occur when the equilibrium for a good or service is not achieved or is not achievable.

Actual Production

The total quantity of goods and services produced by an economy or firm at any given time, reflecting real output.

Diagram

A simplified drawing showing the appearance, structure, or workings of something; a schematic representation.

Allocative Efficiency

A state of the economy in which production represents consumer preferences; every good or service is produced up to the point where the last unit provides a benefit to consumers equal to the cost of producing it.