CHAPTER 2 Auditing-Theory-MCQs-by-Salosagcol-with-answers
CHAPTER 2 Auditing-Theory-MCQs-by-Salosagcol-with-answers
7. Which of the following best identifies the two types of 14. Which of the following statement about fraud or error is
fraud? incorrect?
a. Theft of assets and employee fraud. a. The auditor is not and cannot be held
b. Misappropriation of asset and defalcation. responsible for the prevention of fraud and
c. Management fraud and employee fraud. error.
d. Fraudulent financial reporting and b. The responsibility for the prevention and
management fraud. detection of fraud and error rests with
management.
8. Which of the following statements best describe an c. The auditor should plan and perform the
auditor’s responsibility to detect errors and fraud? audit with an attitude of professional
skepticism, recognizing that conditions or
events may be found that fraud or error may
exist.
d. The likelihood of detecting fraud is
ordinarily higher than that of detecting error.