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25) Information risk refers to the risk that

A. the client may not be able to remain in business.

B. errors and frauds are not detected by the auditor's procedures.

C. the client's financial statements may be materially false and misleading.

D. the auditor may express an unqualified opinion on financial statements that are materially misstated.

26) Professional skepticism dictates that when management makes a statement to the auditors, the auditors must

A. require that the statement be put in writing.

B. believe the statement to maintain the professional client-auditor relationship.

C. disregard the statement because it ranks low on the evidence quality scale.

D. corroborate the evidence with other supporting documentation whenever possible.

27) Which audit objective is related to the assertion that all transactions and accounts must be included in the financial statements?

A. Completeness

B. Presentation and disclosure
C. Existence or occurrence

D. Rights and obligations

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Solution provided by:
Carol Sargent, PhD
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
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