Podcast
Questions and Answers
Which of the following is NOT considered a primary responsibility of the auditor under SA 240?
Which of the following is NOT considered a primary responsibility of the auditor under SA 240?
When management refuses to correct a material misstatement due to fraud, which of the following opinions should the auditor likely issue?
When management refuses to correct a material misstatement due to fraud, which of the following opinions should the auditor likely issue?
Under SA 240, auditors are required to maintain a specific attitude during the audit. What is this attitude?
Under SA 240, auditors are required to maintain a specific attitude during the audit. What is this attitude?
Which action is part of the auditor’s response to assessed fraud risks according to SA 240?
Which action is part of the auditor’s response to assessed fraud risks according to SA 240?
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If an auditor suspects fraud but lacks sufficient evidence to confirm it, what should they do?
If an auditor suspects fraud but lacks sufficient evidence to confirm it, what should they do?
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Study Notes
Auditor's Responsibility under SA 240
- Auditors are responsible for identifying and assessing the risk of material misstatement due to fraud.
- Auditors must respond to assessed fraud risks by designing appropriate audit procedures.
- Auditors are required to maintain professional skepticism throughout the audit process.
- Auditors are not responsible for preventing fraud within an organization.
Auditor Opinions When Management Refuses to Correct Material Misstatement
- When management refuses to correct a material misstatement due to fraud, the auditor should issue a qualified opinion.
- A qualified opinion indicates that the financial statements are presented fairly, except for the specific material misstatement.
- An unqualified opinion, adverse opinion, and disclaimer of opinion are not appropriate in this scenario.
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Description
This quiz focuses on the auditor's responsibilities regarding fraud assessment and the implications of management's refusal to correct material misstatements. It covers essential audit procedures and the types of opinions that can be issued in such scenarios. Test your understanding of these critical concepts in auditing.
