The Auditing Standards Describe How an Auditor Determines If the Preconditions

question 56

Multiple Choice

The auditing standards describe how an auditor determines if the preconditions for an audit are present.Which of the following would be a precondition for an audit?

• A)The auditor obtains the agreement of management that it acknowledges and understands its responsibility for the issuing of the financial statements in accordance with the financial reporting framework.
• B)The auditor obtains the agreement from management that it acknowledges and understands its responsibility for internal controls so financial statements can be prepared free of material misstatement.
• C)The auditor obtains the agreement of management that it agrees to provide the auditor with all information that management is aware of that might be relevant to the preparation of the financial statements.
• D)The auditor determines whether the financial reporting framework (the set of accounting standards)used by the client to prepare the financial statements is acceptable.

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Definitions:

Dramatizing

The act of expressing or emphasizing something in a dramatic or exaggerated manner, often to elicit a specific response or attention.

Broker

An individual or entity that acts as an intermediary, facilitating transactions between two or more parties.

Needed Services

Essential services required to meet the basic or specific needs of individuals or communities, such as healthcare, education, or waste management.

Intervention Role

The active effort to bring about change or provide assistance in a situation, often related to health, social, or educational services.