Assume That Application of Analytical Procedures Revealed Significant Unexplained Differences

question 71

Multiple Choice

Assume that application of analytical procedures revealed significant unexplained differences between recorded amounts and the expectations (estimates) developed by the auditor.If management is unable to provide an acceptable explanation,the auditor should

• A) Consider the matter a scope limitation.
• B) Perform additional audit procedures to investigate the matter further.
• C) Intensify the audit with the expectation of detecting management fraud.
• D) Withdraw from the engagement.

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Definitions:

Identification

The process through which an individual aligns themselves with specific groups, values, or characteristics.

Superego

The superego is a component of Sigmund Freud's psychoanalytic theory, acting as the ethical component of the personality by providing moral standards by which the ego operates.

Oedipus Complex

A psychoanalytic theory introduced by Freud suggesting a child's unconscious sexual desire for the opposite-sex parent and jealousy towards the same-sex parent.

Free Association

A psychoanalytic technique in which the patient verbalizes thoughts as they come to mind without censorship or selection, intended to uncover unconscious desires and conflicts.