The Internal Control Deficiencies Identified in a Financial Statement Audit

question 78

Multiple Choice

The internal control deficiencies identified in a financial statement audit may be reported in several ways.Which of the following are not appropriate methods of reporting?

• A)Significant deficiencies are reported in writing to management.
• B)Material weaknesses are reported in writing to the audit committee.
• C)Deficiencies that fail to reach the level of significant deficiencies or material weaknesses may be reported to management.
• D)Significant deficiencies and material weaknesses are reported in writing to both management and the audit committee.

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Definitions:

Separate the People

A conflict resolution strategy focusing on separating personal emotions and perceptions from the objective problem-solving process.

Compromise Bargaining

A negotiation strategy where two parties in conflict concede on certain points to reach an agreement that is acceptable to both.

Distributive Bargaining

A strategy that involves two parties trying to claim a “fixed pie” of resources.

Competitive Bargaining

Competitive bargaining is a negotiation strategy where parties vie for the most advantageous position, often viewing the situation as a zero-sum game where one's gain is another's loss.