Audit Risk Involves the Risk That

question 47

Multiple Choice

Audit risk involves the risk that:

• A) The financial statements contain a misstatement.
• B) The ICFR fails to report material internal control weaknesses and the audit report also fails to mention this fact.
• C) The client lied to management.
• D) All of the above.

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Definitions:

Crowd Psychology

The study of how individual behavior is influenced by large groups of people, including the way emotions and behaviors can be contagious.

Social Identities

The portion of an individual's self-concept derived from perceived membership in social groups, such as national, cultural, religious, or occupational groups.

Spread of Rumors

The process by which unverified information is circulated among people, often leading to misinformation or misunderstanding.

Anxious

Feeling anxiety or distress, especially when facing an upcoming event or dealing with something that has an unsure result.