Which of the Following Statements Best Describes Auditors' Responsibility to Detect

question 48

Multiple Choice

Which of the following statements best describes auditors' responsibility to detect errors and frauds?

• A)Auditors should design an audit to provide reasonable assurance of detecting errors and frauds that are material to the financial statements.
• B)Auditors are responsible to detect material errors, but have no responsibility to detect material frauds that are concealed through employee collusion or management override of the internal control structure.
• C)Auditors have no responsibility to detect errors and frauds unless analytical procedures or tests of transactions identify conditions causing a reasonably prudent auditor to suspect that the financial statements were materially misstated.
• D)Auditors have no responsibility to detect errors and frauds because an auditor is not an insurer and an audit does not constitute a guarantee.

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Definitions:

$4 Trillion Debt

A monetary amount representing the scale of owed funds, possibly pertaining to national debt or a significant financial obligation of a large entity.

Ongoing Costs

Continuous or recurring expenses associated with maintaining a project, venture, or lifestyle, which do not end after the initial purchase or investment.

Two Wars

Refers generally to a nation or entity being involved in two separate conflicts simultaneously or consecutively.

New Orleans Residents

The inhabitants of New Orleans, a culturally rich and diverse city located in the state of Louisiana, USA.