The Auditor Is Responsible for Evaluating the Likelihood of a Client

question 51

Multiple Choice

The auditor is responsible for evaluating the likelihood of a client continuing as a going concern for a reasonable period of time.A reasonable period of time is which of the following?

• A)one year from the audit report date.
• B)one year from the last day of field work.
• C)one year from the balance sheet date.
• D)two years from the balance sheet date.

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Definitions:

Power

The capacity or ability to direct or influence the behavior of others or the course of events.

Discretionary Stakeholder

Stakeholders whose involvement with an organization or project is based on choice rather than necessity or contractual obligation.

Discretionary Stakeholder

A party with a non-essential interest or stake in a project or business that can affect or be affected by its outcome but is not engaged in daily operations.

Influence

The capacity to have an effect on the character, development, or behavior of someone or something.