The Auditor Is Required to Document in the Work Papers

question 52

Multiple Choice

The auditor is required to document in the work papers his understanding of the company and its environment and his assessment of the risks of material misstatement.This documentation should include

• A)the significant decisions during the discussion among management regarding the susceptibility of the company's financial statements to material misstatement due to fraud
• B)how and when the discussion occurred
• C)the audit team members who participated
• D)the identified and assessed risks of material misstatement at both the financial statement level,and the procedures performed to obtain the information
• E)both A and C
• F)both B and C
• G)both C and E

---

Definitions:

Mental Activity

The operations of the mind involving thinking, understanding, learning, and remembering.

Science of Behavior

The systematic study of the actions and reactions of humans and animals in response to external or internal stimuli.

Predict Human Behavior

The process of using psychological principles, statistical data, and algorithms to forecast actions or reactions of individuals in specific situations.

Connecting Information

The process of relating new information to existing knowledge in order to enhance understanding and memory.