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Which of the following groups within an entity is typically in the best position to perpetrate a material fraud?
Management is typically in the best position to perpetrate a material fraud because management can override controls to manipulate accounting records and prepare fraudulent financial statements.
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According to PCAOB standards which one of the following statements does not reflect a qualitative standard that should be considered when evaluating the materiality of an uncorrected misstatement or error?
The dollar amount of the error does not reflect a qualitative standard that should be considered when evaluating the materiality of an uncorrected misstatement or error.
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Misstatements discovered by an auditor were immaterial in the aggregate in prior years. Such misstatements should be:
Misstatements discovered by an auditor were immaterial in the aggregate in prior years. Such misstatements should be considered in the current year evaluation of audit findings.
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Prior to or during the information gathering procedures for an audit, team members should discuss the potential for material misstatement dur to fraud. Of the following, which best characterizes the mind set that the audit team should maintain during this discussion?
During an audit, the CPA should maintain an attitude of professional skepticism which includes a questioning mind and a critical assessment of audit evidence.
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Of the following, which best characterizes the auditor's exercise of professional skepticism?
Professional skepticism is an attitude that includes a questioning mind and a critical assessment of audit evidence.
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An employee at a company being audited may be more likely to commit fraud if he or she feels which of the following?
These three factors in the fraud environment are the key components of the reasons someone would commit fraud.
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