Which of the Following Statements Regarding the Reporting of Critical

question 50

Multiple Choice

Which of the following statements regarding the reporting of critical audit matters (CAMs) under PCAOB guidance is incorrect?

• A)Matters that are material to the financial statements but do not relate to accounts or disclosures are not CAMs.
• B)If no CAMs arose during the audit,the audit report should not contain any reference to CAMs.
• C)The disclosure of CAMs under PCAOB guidance is similar to disclosure of KAMs under IAASB guidance.
• D)All of the above are incorrect.

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Definitions:

City Council

The legislative body that governs a city, town, or municipality, responsible for making and enforcing local laws and policies.

Median-Voter Theorem

A theory suggesting that the outcome of majority voting processes will reflect the preferences of the median voter when preferences are single-peaked and voters are fully informed.

Middle-of-the-Road Positions

Political or policy positions that are not extreme, representing a moderate or centrist point of view.

Satisficing Behavior

A decision-making strategy that entails searching through the available alternatives until an acceptability threshold is met, rather than seeking the best possible solution.