The Auditor Performs Analytical Procedures to

question 130

Multiple Choice

The auditor performs analytical procedures to

• A)increase his understanding of the accounting system
• B)identify expected changes between his expectations for the current year and the prior year
• C)identify areas where he believes the risk of material misstatement might not be present
• D)satisfy the requirement of the auditing standards to use analytical procedures during the planning stage

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Definitions:

Absolute Threshold

The smallest intensity of a stimulus that can be detected by an organism's sensory systems 50% of the time.

Signal Detection

A theory that aims to quantify the ability to discern between information-bearing patterns and random patterns that distract from the information.

Absolute Threshold

The absolute threshold refers to the minimum intensity of a stimulus that one can detect 50% of the time.

Difference Threshold

The minimum difference in stimulation needed to detect a change or difference between two stimuli.