15.Audit planning:A. is the same irrespective of the size or complexity of the entity.B. requires confidentiality.C. requires an understanding of the entity.D. is necessary so that management can be advised of what the auditor intends to test. 16.Audit planning assists the auditor to:17.Which of the following situations would most likely require special audit planning by the auditor?18.An auditor obtains knowledge about a new client’s business and its industry in order to:19.An auditor searching for related-party transactions should obtain an understanding of each subsidiary’s relationship to the total entity because:A. intercompany transactions may have been consummated on terms equivalent to arm’s length transactions.B. this might reveal whether particular transactions would have taken place if the parties had not been related.C. the business structure may be deliberately designed to obscure related-party transactions.D. this might permit the audit of intercompany account balances to be performed as of concurrent dates.20.Which of the following procedures would not be used to obtain an understanding of the entity and its environment?
21.An auditor who accepts an audit engagement and does not possess the industry expertise of the business entity should:
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