Exam 4: Management Fraud and Audit Risk

If tests of controls induce the auditor to change the assessed level of control risk for Property Plant & Equipment from 50% to 100%,and audit risk (6%)and inherent risk remain constant,the acceptable level of detection risk

Which of the following analytical procedures most likely would be used during the planning stage of an audit?

For each of the following statements or phrases,Match the professional standard to which it relates.

The acceptable level of detection risk is inversely related to the

When an auditor becomes aware of possible noncompliance by a client,the auditor should obtain an understanding of the nature of the act to

Experience has shown that the many large fraudulent transactions can be found in

According to auditing standards,external auditors' responsibilities for indirect noncompliance do not include

An auditor who discovers that client employees have committed an illegal act that has a material effect on the client's financial statements most likely would withdraw from the engagement if

The risk that an auditor's procedures will lead to the conclusion that a material misstatement does not exist in an account balance when,in fact,such misstatement actually exists is

In auditing related party transactions,an auditor ordinarily places primary emphasis on

Certain conditions and circumstances are often present when management fraud occurs.Which of the following is not such a condition or circumstance?

In the planning stage,analytical procedures are used to

Inherent risk and control risk differ from detection risk in which of the following ways?

Prior to,or in conjunction with,the information-gathering procedures for an audit,audit team members should discuss the potential for material misstatement due to fraud.Which of the following best characterizes the mind-set that the audit team should maintain during this discussion?

The type of financial analysis that expresses balance sheet accounts as percentages of total assets is known as

An auditor's analytical procedures indicate a lower than expected return on an equity method investment.This situation most likely could have been caused by

The purpose of an audit strategy is

The audit risk model includes the four risks listed below.Match the type of risk with the related definition.

The major emphasis in GAAS related to consideration of fraud in a financial statement audit (AU 240)is on

For each of the descriptions in Column A,match the correct word or words from Column B.