To Obtain Reasonable Assurance,which Is a High,but Not Absolute Level

question 81

Multiple Choice

To obtain reasonable assurance,which is a high,but not absolute level of assurance,the auditor:

• A)performs the work and properly supervises the client
• B)assumes appropriate materiality level or levels
• C)identifies and assesses risks of material misstatement,whether due to fraud or error,based on an understanding of the entity and its environment,including the entity's internal control
• D)obtains sufficient appropriate management representations about whether material misstatements exist

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Definitions:

EPS

Earnings Per Share, a measure of a company's profitability that is calculated by dividing its net income by the number of outstanding shares.

Stock Repurchase

The process of a corporation repurchasing its own stocks from the market to potentially boost the value of the remaining stocks.

Excess Cash

Additional cash held by a business that exceeds its operational and investment needs.

Earnings Per Share

A financial metric that measures the total earnings available to shareholders divided by the number of shares outstanding.