Which of the Following Circumstances Most Likely Would Cause an Auditor

Multiple Choice

Which of the following circumstances most likely would cause an auditor to suspect that there are material misstatements in an entity's financial statements?

A) Senior financial management participates in the selection of accounting principles and the determination of significant estimates.
B) Supporting accounting records and files that should be readily available are not produced promptly when requested.
C) Related party transactions take place in the ordinary course of business with an entity that is audited by another CPA firm.
D) Senior management has an excessive interest in upgrading the entity's information technology capabilities.