Which of the Following Would an Auditor Be Most Likely

question 16

Multiple Choice

Which of the following would an auditor be most likely to use in determining the preliminary judgment about materiality?

• A)The entity's annualised interim financial statements.
• B)The contents of the management representation letter.
• C)The results of the internal control questionnaire.
• D)The anticipated sample size of the planned substantive tests.

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Definitions:

Statement Of Changes In Equity

This financial statement illustrates how a company's equity has changed during a specific period due to transactions with owners, like dividends and investments.

Shareholders' Equity

The residual interest in the assets of a company after deducting liabilities, representing ownership interest.

Liabilities

Financial obligations or debts that a company owes to others, which need to be settled over time through the transfer of assets, provision of services, or other economic benefits.

Assets

Economic resources owned or controlled by a business or an individual, capable of producing value and used to generate income or meet obligations.