After Issuance of the Auditor's Report,the Auditor Has No Obligation

question 18

Multiple Choice

After issuance of the auditor's report,the auditor has no obligation to make any further inquiries with respect to audited financial statements covered by an auditor's report unless

• A) a lawsuit in which risk of loss was considered remote is resolved in the company's favor.
• B) a development occurs that may affect the entity's ability to continue as a going concern.
• C) a material fraud is initiated by an employee after the report is issued.
• D) evidence of significant, non-arms-length, related party transactions that happened prior to year-end is discovered.

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Definitions:

Workers

Individuals who perform tasks or jobs for pay, ranging from manual labor to professional occupations.

Units

In economics, units refer to the quantifiable measures used to express the quantity of an item, such as pieces, kilograms, liters, etc., used in transactions or production.

Total Cost

The complete cost of production, encompassing both fixed and variable costs, for a good or service.

Average Fixed Cost

The fixed costs of production divided by the quantity of output produced; decreases as production increases.