Which of the Following Is a Difference Between an External

question 32

Multiple Choice

Which of the following is a difference between an external auditor and a forensic accountant?

• A) An external auditor captures and records all economic transactions of the organization, whereas a forensic accountant ensures compliance with policy and procedures.
• B) An external auditor manages the organization's accounting and internal control system, whereas a forensic accountant validates effectiveness of controls in various processes or areas of the organization.
• C) An external auditor adds credibility to reported financial information, whereas a forensic accountant provides assurance that management is adequately identifying and mitigating risks.
• D) An external auditor forms an opinion on the overall financial statements taken as a whole, whereas a forensic accountant addresses a specific question/issue.

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Definitions:

Actual Performance

The real results achieved by an individual, team, or organization as compared to the goals or standards set.

Intuitive Thinking

Thinking that approaches problems in a flexible and spontaneous fashion.

Limited Facts

A situation or condition in which information available is scarce or incomplete, making it difficult to make informed decisions.

Decision Precedents

Are past decisions that serve as a guide or reference for making future decisions in similar situations.