Management's Responsibility When Considering the Company's Compliance with Laws and Regulations

question 73

Multiple Choice

Management's responsibility when considering the company's compliance with laws and regulations during an audit of financial statements is

• A)to ensure that the company complies with the laws and regulations that affect the company
• B)to identify material misstatements that might occur in the financial statements due to noncompliance with laws and regulations
• C)to ensure that the company complies with the laws and regulations that might affect the company
• D)to identify material misstatements that have occurred in the financial statements due to noncompliance with laws and regulations

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Definitions:

Execution

The process of carrying out a court order or judgment, including the legal procedures involved in enforcing rights or the carrying out of the terms of a legal document.

Negligent Misrepresentation

The act of unintentionally providing false information that others rely upon, leading to financial loss or damage.

Elements Of Fraud

Elements of Fraud include the intentional misrepresentation or concealment of an important fact upon which the victim is meant to rely, and does rely, resulting in harm to the victim.

Material

Refers to the physical substances or components that are used to make or build something.