The Audit Failures of Both Enron and WorldCom Were Examples

question 20

Multiple Choice

The audit failures of both Enron and WorldCom were examples in which the leadership responsibilities for quality work within the accounting firm were overshadowed by fears that losing a key client would

• A)Result in shareholder losses from reduced company profitability.
• B)Require additional audit procedures and increase the fees paid by the companies to the accounting firm.
• C)Negatively influence the results of the firm's inspection.
• D)Negatively impact individual auditors' performance evaluations.

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Definitions:

Listening Process

A series of steps that include receiving, understanding, evaluating, remembering, and responding to spoken messages.

Store Information

The process of saving or archiving data in a physical or digital format for future use or retrieval.

Critical Listening

Listening to understand and evaluate the meaning of the speaker’s message.

Evaluate Evidence

The process of examining and assessing information to determine its credibility and relevance.