Provide some additional examples of business risks that might not lead to a risk of material misstatement in the financial statements.
Professional auditing standards provide guidance on the auditor’s consideration of an entity’s business environment and associated business risks.
Most business risks will eventually have financial consequences. However not all business risks will
give rise to material misstatements. A few examples of business risks that might not lead to a risk of
material misstatement in the financial statements may include:
? Employee stealing petty cash funds.
? Employee use of company office supplies for personal benefit not company benefit.
? Employee running a personal side business from company facilities.
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Indicate whether the statement is true or false
The United States and Germany may request an advisory opinion from the ICJ to settle a dispute over a trade issue
a. True b. False Indicate whether the statement is true or false
Given the expected returns and probabilities of various states of the world in this table, what is the expected return for Carbide Company?
Carbide Company State of the Economy Probability of State Return on State Boom .30 18% Steady .55 10% Recession .15 -5% A) 10.15% B) 5.40% C) 5.50% D) -0.75%
President Nixon issued wage-price controls in an effort to stabilize the economy. This use of executive power was
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