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The Risk of Underreliance Occurs When the Auditor's Estimate of the Deviation

question 26

True/False

The risk of underreliance occurs when the auditor's estimate of the deviation rate exceeds the tolerable rate of deviation.

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Definitions:

Theory X

A management theory that assumes employees are inherently lazy and will avoid work if they can, suggesting the need for strict oversight and control.

Theory Y

A management concept that assumes employees are inherently motivated and enjoy their work duties, suggesting that the role of management is to develop the potential of employees and help them to achieve self-fulfillment.

Management Technique

A method or approach used by managers to improve efficiency, solve problems, and achieve organizational goals.

Contingency

Contingency refers to a future event or circumstance that is possible but cannot be predicted with certainty, often implying the need for plans to address potential changes.

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