Generally Accepted Auditing Standards Permit Auditors to Place Complete Reliance

question 3

True/False

Generally accepted auditing standards permit auditors to place complete reliance on internal control (zero control risk assessment)to justify the exclusion of substantive audit procedures for a balance sheet or income statement account.

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Definitions:

Non Est Factum

Non est factum is a legal defense in contract law that asserts a signed agreement is void because the signer was mistaken about its nature and character.

Negligence

A failure to act with the care that a reasonably prudent person would exercise under the same circumstances, often leading to liability for resulting damages.

Privity of Contract

The principle that a contract confers rights and imposes liabilities only on its parties; no outsider can gain rights or be liable under it.

Novation

The process of replacing an existing obligation with a new one, substituting a party or terms in a contract with the consent of all parties involved.