In the Planning Process,the Auditor Assesses the Risk That Misstatements

question 118

Multiple Choice

In the planning process,the auditor assesses the risk that misstatements have occurred in the financial statements.The source of misstatements includes

• A)the use of auditing standards that the auditor may consider unreasonable or inappropriate
• B)inaccuracies in gathering or processing data used to audit the financial statements
• C)differences between the amount or classification of a financial statement item and what should have been reported under generally accepted accounting principles
• D)omissions of financial statement explanations
• E)financial statement disclosure that are not in accordance with generally accepted auditing standards

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Definitions:

Reasoning

Reasoning is the cognitive process of thinking about something in a logical, rational way, to form conclusions, judgments, or inferences.

System II Thinking

is a mode of thought characterized by more deliberate, conscious, and analytical reasoning, often involving complex judgments or problem-solving.

System I Thinking

A term in psychology that refers to the fast, automatic, intuitive approach of decision-making, as opposed to slow, deliberate, analytical thinking.

Confirmation Bias

The habit of seeking out, understanding, preferring, and remembering data in a manner that validates one's already established views or theories.