The Most Significant Audit Issue That Came as a Result

question 14

Multiple Choice

The most significant audit issue that came as a result of the court decision in the Escott et al.v.Bar Chris Construction Corporation case in 1968 was:

• A)the court's reaffirmation that the burden of proof was on the plaintiff to prove the auditor was negligent.
• B)the affirmation of the increased auditor's responsibility when performing an S-1 review, a review of events subsequent to the balance sheet, for registration statements.
• C)the increased auditor responsibility when associated with unaudited financial statements.
• D)the court's refusal to allow the percentage-of-completion method of accounting for revenues.

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Definitions:

Process Chart

Graphic representation that depicts a sequence of steps for a process.

Time Axis

The graphical representation of time in charts or graphs, often serving as the horizontal axis to plot time-dependent data.

Service Blueprinting

A process analysis technique that lends itself to a focus on the customer and the provider’s interaction with the customer.

Process-focused Facilities

Operations facilities organized around specific activities or processes, optimizing the production of a small variety of similar products.