Answered: The risk to investors that a company’s…

The risk to investors that a company’s financial statements may be materially misleading is calleda. Client acceptance risk.b. Information risk.c. Moral hazard.d. Business risk.

Auditing: A Risk Based-Approach to Conducting a Quality Audit

10th Edition

ISBN:9781305080577

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter7: Planning The Audit: Identifying, And Responding To The Risk Of Material Misstatement

Section: Chapter Questions

Problem 5TFQ

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Question

The risk to investors that a company’s financial statements may be materially misleading is called
a. Client acceptance risk.
b. Information risk.
c. Moral hazard.
d. Business risk.

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