Which of the Following Statements Best Describes the Auditor's Responsibility

question 90

Multiple Choice

Which of the following statements best describes the auditor's responsibility regarding the detection of fraud?

• A) The auditor is responsible for the failure to detect fraud only when such failure clearly results from nonperformance of audit procedures specifically described in the engagement letter.
• B) The auditor is required to provide reasonable assurance that the financial statements are free of both material errors and fraud
• C) The auditor may extend auditing procedures to actively search for evidence of fraud where the examination indicates that fraud may exist.
• D) The auditor is responsible for the failure to detect fraud only when an unqualified opinion is issued.

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Definitions:

Bribes

Illicit payments made to influence the actions or decisions of someone in a position of power.

Ethical Dilemma

A situation in which a person is required to choose between two equally problematic alternatives, often involving a conflict of moral principles.

Sexual Harassment

Unwelcome or offensive sexual behavior, which can range from inappropriate jokes to physical assault, that creates a hostile work environment.

Inappropriate Comments

Statements or remarks that are offensive, irrelevant, or not suitable for a particular context or audience.