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Auditing & Assurance Services 7th Edition by Timothy Louwers Test bank

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Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 01-01 Define information risk and explain how the financial statement auditing process helps to reduce this risk; thereby reducing the cost of capital for a company.
Source: Original
Topic: User Demand for Reliable Information
   
21. Which of the following is not included in The American Accounting Association (AAA) definition of auditing? 
 


 
A.  Potential conflict of interest
 
B.  Systematic process
 
C.  Assertions about economic actions
 
D.  Established criteria
 
AACSB: Analytic
AICPA: BB Legal
AICPA: FN Research
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 01-02 Define and contrast financial statement auditing; attestation; and assurance services.
Source: Original
Topic: Auditing, Attestation, and Assurance Services
 
 
22. What is the term used to identify the risk that the client's financial statements may be materially false and misleading? 
 


 
A.  Business risk
 
B.  Information risk
 
C.  Client risk
 
D.  Risk assessment
 
AACSB: Analytic
AICPA: BB Legal
AICPA: FN Risk Analysis
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 01-01 Define information risk and explain how the financial statement auditing process helps to reduce this risk; thereby reducing the cost of capital for a company.
Source: Original
Topic: User Demand for Reliable Information
 
 
23. Which of the following is not a recommendation usually made following the completion of an operational audit? 
 

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