Assume That Application of Analytical Procedures Revealed Significant Unexplained Differences

question 16

Multiple Choice

Assume that application of analytical procedures revealed significant unexplained differences between recorded amounts and the auditor's expectations.If management is unable to provide an acceptable explanation,the auditor should ________.

• A)consider the matter a scope limitation
• B)perform additional audit procedures to investigate the matter further
• C)intensify the audit with the expectation of detecting management fraud
• D)withdraw from the engagement

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Definitions:

Inferential Statistics

A branch of statistics that allows one to make predictions or inferences about a population based on a sample of data drawn from that population.

Statistics

The branch of mathematics dealing with data collection, analysis, interpretation, and presentation.

Correlated

A statistical relationship indicating that two variables move in relation to each other, either positively or negatively.

Relationship

How two or more entities, things, or persons relate to each other, or their state of linkage.