An Auditor Who Discovers That Client Employees Have Committed an Illegal

question 19

Multiple Choice

An auditor who discovers that client employees have committed an illegal act that has a material effect on the client's financial statements most likely would withdraw from the engagement if:

• A)the noncompliance is a violation of generally accepted accounting principles.
• B)the client does not take the remedial action that the auditor considers necessary.
• C)the illegal act was committed during a prior year that was not audited.
• D)the auditor has already assessed control risk at the maximum level.

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Definitions:

N = 15

Specifies the sample size of a study or dataset, indicating that there are 15 observations or elements.

Males

Refers to the male gender or sex in biological or sociological contexts.

Females

A term often used in research or statistics to denote the sex category of subjects or participants that identifies as female.

Hypotheses

Plural of hypothesis; statements or propositions made for the sake of argument that can be tested through experimentation or observation.