How Should Auditors Use the Concept of Materiality

question 4

Multiple Choice

How should auditors use the concept of materiality?

• A)As a guide to assessing inherent risk
• B)As a guide in assessing control risk.
• C)As a guide in deciding to report a deficiency to the audit committee.
• D)As a guide in planning the audit program.

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Definitions:

Big Five

A model describing human personality as composed of five broad traits: openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Abraham Maslow

A psychologist known for creating Maslow's hierarchy of needs, a theory in psychology regarding human motivation.

Free Will

The concept that individuals have the ability to make choices that are not predetermined by past events, genetics, or environment.

Rollo May

An American existential psychologist who emphasized the importance of anxiety, love, and courage in human behavior.