An Auditor's Study and Evaluation of the Internal Accounting Control

question 6

Multiple Choice

An auditor's study and evaluation of the internal accounting control system made in connection with an annual audit is usually not sufficient to express an opinion on an entity's system because:

• A)the audit cost-benefit relationship permits an auditor to express only reasonable assurance that the system operates as designed.
• B)the evaluation of weaknesses is subjective enough that an auditor should not express an opinion on the internal accounting controls alone.
• C)only those controls on which an auditor intends to rely are reviewed, tested and evaluated.
• D)management may change the internal accounting controls to correct weaknesses.

Differentiate between various market structures, with a focus on oligopoly characteristics.

Identify factors leading to the success or failure of collusion in oligopolistic industries.

Analyze the impact of market share distribution on market concentration and competition.

Distinguish between concentration ratios and the HHI as measures of market concentration.