Management Is Responsible for Designing the Controls and the Auditor

question 18

Multiple Choice

Management is responsible for designing the controls and the auditor is responsible for

• A)testing them only if he chooses to rely on them to prevent or detect misstatements in the account balances.
• B)testing them only if he chooses to rely on them to prevent or detect misstatements in the transactions.
• C)testing them only if he chooses to rely on them to prevent or detect misstatements in the financial statements.
• D)testing them only if he chooses to rely on them to prevent or detect misstatements in the management representations.

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Definitions:

Unreliable Memories

Unreliable memories refer to the phenomenon where recollections of past events are distorted or fabricated, often due to the limitations of human memory storage and retrieval.

Flashbulb Memory

A highly detailed and vivid memory of an emotionally significant moment or event, which is believed to be recalled with high accuracy.

Episodic Memory

A type of long-term memory that involves the recollection of specific events, situations, and experiences, including their contexts and associated emotions.

Autobiographical Memory

Refers to a person's memory of specific episodes or events from their own life, often containing emotional and contextual details.