With Respect to the Audit of a Nonissuer, Significant Deficiencies

Multiple Choice

With respect to the audit of a nonissuer, significant deficiencies are matters that come to an auditor's attention, which should be communicated to an entity's management and those charged with governance because they represent:

A) Material irregularities or illegal acts perpetrated by high-level management.
B) Deficiencies in the design or operation of internal control that could reasonably be expected to cause a non-inconsequential misstatement in the financial statements.
C) Flagrant violations of the entity's documented conflict-of-interest policies.
D) Intentional attempts by client personnel to limit the scope of the auditor's fieldwork.