In addition to evaluating the frequency of deviations in tests of controls, an auditor also considers certain qualitative aspects of the deviations. The auditor most likely will give broader consideration to the implications of a deviation if it isSelect one:a.The only deviation discovered in the sample.b.Caused by an employee's misunderstanding of instructions.c.Identical to a deviation discovered during the prior year's audit.d.Initially concealed by a forged document.
Question
In addition to evaluating the frequency of deviations in tests of controls, an auditor also considers certain qualitative aspects of the deviations. The auditor most likely will give broader consideration to the implications of a deviation if it isSelect one:a.The only deviation discovered in the sample.b.Caused by an employee's misunderstanding of instructions.c.Identical to a deviation discovered during the prior year's audit.d.Initially concealed by a forged document.
Solution
The auditor is most likely to give broader consideration to the implications of a deviation if it is initially concealed by a forged document. This is because such a deviation indicates a serious breach of control, possibly involving fraudulent activity, which could have significant implications for the integrity of the financial statements. This is a more serious issue than a simple misunderstanding of instructions or a one-time deviation. Even if the same deviation was discovered in the prior year's audit, the fact that it was initially concealed by a forged document raises more serious concerns about the effectiveness of the company's internal controls.
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