Which of the Following Statements Is About Audit Risk

question 41

Multiple Choice

Which of the following statements is about audit risk?

• A) It is impossible to completely eliminate audit risk
• B) Audit risk is the risk that an auditor expresses an inappropriate opinion when a financial report is materially stated
• C) Audit risk can be reduced at the planning stage of an audit by identifying the key risks faced by the client
• D) All of the above

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Definitions:

Lack of Strategy

A situation where there is an absence of a clear plan or direction, often leading to ineffective decision-making and organizational performance.

Strategic Leadership

Involves making decisions that ensure an organization's long-term growth, focus, and success, considering the broad and future implications.

Vision and Mission

Fundamental organizational statements where the vision articulates the desired future state and the mission describes the organization's purpose.

Succession Problem

The challenge an organization faces in identifying and preparing new leaders to replace those who are leaving.