Why Will an Auditor More Extensively Test Controls for the Completeness

question 47

Multiple Choice

Why will an auditor more extensively test controls for the completeness assertion on liability accounts than on asset accounts?

• A) The risk of unrecorded liabilities is greater than the risk of unrecorded assets.
• B) The completeness assertion is not applicable to asset accounts.
• C) The liabilities account balances presented in the financial statements tend to be more complete than the asset accounts.
• D) The most likely type of misstatement for liabilities is overstatements.

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Definitions:

Trust Individuals

A principle that emphasizes the importance of placing confidence in the intentions and actions of people in personal or professional contexts.

Superordinate Dominated

Refers to a scenario where individuals or groups in higher or dominant positions exercise control or authority over others.

George Simmel

A German sociologist, philosopher, and critic known for his analyses of modern urban life and the forms of social interaction.

Human Created Forms

Man-made constructs or artifacts that embody cultural, philosophical, or social values and ideas.