Auditing 410 Test Solutions for Chapter 4
Audit Risk, Business Risk, and Audit Planning
4-1. Business Risk - Those risks that affect the operations and potential outcomes of organizational activities.
Engagement Risk - The risk auditors
1) Which of the following best defines fraud in a financial statement auditing context?
A) Fraud is an unintentional misstatement of the financial statements.
B) Fraud is an intentional misstatement of the financial statements.
C) Fraud is eith
1) The auditor's responsibility section of the standard unqualified audit report states
that the audit is designed to:
A) discover all errors and/or irregularities.
B) discover material errors and/or irregularities.
C) conform to generally accepted
Learning Objective 3-1
1) An audit of historical financial statements most commonly includes the:
A) balance sheet, statement of retained earnings, and the statement of cash flows.
B) income statement, the statement of cash flows, and the statement