For Laws with an Indirect Impact on the Financial Statements

question 23

Multiple Choice

For laws with an indirect impact on the financial statements the auditor should perform audit procedures to identify instances on noncompliance with laws and regulations that may have a material effect on the financial statements.The auditor does this by

• A)inquiring with management about the company's compliance with laws and regulations
• B)reviewing regulations of relevant licensing or regulatory bodies
• C)corresponding with relevant licensing or regulatory bodies
• D)inspecting correspondence with relevant licensing or regulatory bodies
• E)both A and B
• F)both A and D
• G)both C and E

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Definitions:

Mental Illness

A broad range of medical conditions that affect a person's thinking, feeling, mood, and behavior, which can be chronic or episodic in nature.

Headache

A pain or discomfort occurring in any area of the head, often varying in intensity, cause, and duration.

Caffeine

A stimulant chemical found in coffee, tea, and certain other plants, known for its ability to enhance alertness and reduce fatigue.

Binge Drinking

Excessive consumption of alcohol within a short duration of time.