Failure to Detect Material Dollar Errors in the Financial Statements

question 59

Multiple Choice

Failure to detect material dollar errors in the financial statements is a risk which the auditors primarily mitigate by:

• A) Performing substantive procedures.
• B) Performing tests of controls.
• C) Assessing control risk.
• D) Obtaining a client representation letter.

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Definitions:

Dog

A domesticated carnivorous mammal, Canis familiaris, known for its loyalty and companionship with humans.

Low-Growth Market

A market that experiences minimal increases in consumer demand or revenue potential over time.

Cash Cows

Products or business units that generate significantly more money than they consume, often funding other parts of a business.

Strong Cash Flow

Describes a situation where a business or individual has ample cash generation, supporting sustained operations and facilitating growth or investment.