If the Auditor Considers an Illegal Act to Be Sufficiently

question 30

Multiple Choice

If the auditor considers an illegal act to be sufficiently serious to warrant withdrawing from the engagement, the auditor should:

• A)notify all parties who may rely upon the company's illegal act.
• B)consult with legal counsel as to what other action, if any, should be taken.
• C)return all incriminating evidence and working papers to the client's audit committee for follow-up.
• D)contact the successor auditor to make the successor aware of the possible consequences of relying on management's representations.

Understand the components and functions of the money supply (M1, M2, M3).

Identify the historical development and significance of banking.

Recognize the impact of interest rates and inflation on the economy and individual behavior.

Explain the significance of financial instruments such as CDs and their inclusion in different money supply measures.

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Definitions:

PLC System

A programmable logic controller system, an electronic system used for industrial automation, controlling machinery and processes through digital input and output.

Solid-State Switches

Electronic switches that operate without moving parts, using semiconductor devices to switch on or off.

Electrical Noise

Unwanted disturbances superimposed on a useful signal that tend to obscure its information content.