The Auditors in a Public Accounting Firm Are Assigned to New

question 25

Multiple Choice

The auditors in a public accounting firm are assigned to new project teams as their current projects end.Consequently,an auditor may work on one project for an entire year or the auditor may be assigned to several different shorter-term projects during a year.All of the following are behaviors that would be important to encourage through the performance appraisal system EXCEPT

• A) competitiveness.
• B) achievement orientation.
• C) initiative.
• D) information-seeking.

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Definitions:

Estimated Premium Claims

The projected claims against an insurance provider that determines premium rates for policyholders.

Modified Cash Basis

A method of accounting that combines elements of both cash and accrual accounting, recording most transactions on a cash basis, but also incorporating the accrual basis for significant items.

Warranty Expense

Costs associated with the obligation to repair or replace defective products sold to customers, recognized as a liability.

Estimated Liability

A probable future outflow of resources, arising from past transactions or events, the amount of which is not certain.