The SEC Is Concerned That Auditors Don't Pay Enough Attention

question 70

Multiple Choice

The SEC is concerned that auditors don't pay enough attention to qualitative factors affecting materiality because:

• A) Qualitative factors may cause quantitatively small misstatements to become material
• B) Quantitative factors are not always useful
• C) Quantitative factors cannot be accumulated to assess overall materiality
• D) All are of concern to the SEC

---

Definitions:

Intellectual Capital

The intangible assets of an organization, including its knowledge, experiences, and intellectual property, that contribute to its competitive edge.

Knowledge Worker

An individual whose job involves handling or using information and knowledge, often in fields like IT, finance, and engineering.

Work-life Balance

The equilibrium achieved between professional obligations and personal life, contributing to overall well-being.