In Those Audits Where There Is a Heightened Risk of Fraud

question 12

Multiple Choice

In those audits where there is a heightened risk of fraud related to stockholders' equity accounts,which of the following will the auditor typically not perform?

• A)Confirm terms of equity arrangements and shares held directly with shareholders.
• B)Account for and vouch all proceeds from stock issues.
• C)Confirm with shareholders whether there are any side agreements.
• D)Review equity authorizations in the board meeting minutes.

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Definitions:

Book

A collection of printed or handwritten pages, attached along a single edge and encased in a covering.

Marginal Revenue Function

A calculation used to determine the additional revenue generated by selling one more unit of a good or service.

Demand

An economic principle referring to the consumer's desire and willingness to pay for a specific quantity of a good or service at a given time.

Book

A published material that features pages bound together on one side and encased within protective covers.