Bundle: Auditing: A Risk Based-Approach, Loose-leaf Version, 11th + MindTap Accounting, 1 term (6 months) Printed Access Card
11th Edition
ISBN: 9781337734493
Author: JOHNSTONE, Karla M; Gramling, Audrey A.; Rittenberg, Larry E.
Publisher: Cengage Learning
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Chapter 4, Problem 7CYBK
To determine
Audit firm litigation:
An audit firm may face litigations for its failure in an audit engagement. Most of the audit litigations occur at the time of failure of business or detection of company frauds by the third party.
To choose: The false statement.
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Which of the following is NOT a possible legal risk that can arise because of a fraud investigation conducted in an improper manner? A. Forcible entry and detainer. B. Invasion of privacy. C. Defamation. D. Malicious prosecution.
Fraud is an ________ act by any person to conceal the truth, deceive and obtain illegal advantage.
a.
Unintentional
b.
Honest
c.
Intentional
d.
True and fai
Culpa aquiliana as distinguished from culpa contractual:
Proof of due diligence in the selection and supervision of employees is not considered a defense.
Proof of the contract and its breach is sufficient to warrant recovery.
The negligence of the defendant is only an incident in the performance of the obligation.
The source of liability is the negligent act of the person causing damage to another.
Chapter 4 Solutions
Bundle: Auditing: A Risk Based-Approach, Loose-leaf Version, 11th + MindTap Accounting, 1 term (6 months) Printed Access Card
Ch. 4 - Prob. 1CYBKCh. 4 - Prob. 2CYBKCh. 4 - Prob. 3CYBKCh. 4 - Prob. 4CYBKCh. 4 - Prob. 5CYBKCh. 4 - Prob. 6CYBKCh. 4 - Prob. 7CYBKCh. 4 - Prob. 8CYBKCh. 4 - Prob. 9CYBKCh. 4 - Prob. 10CYBK
Ch. 4 - Prob. 11CYBKCh. 4 - Prob. 12CYBKCh. 4 - Prob. 1RQSCCh. 4 - Prob. 2RQSCCh. 4 - Prob. 3RQSCCh. 4 - Prob. 4RQSCCh. 4 - Prob. 5RQSCCh. 4 - Prob. 6RQSCCh. 4 - Refer to the Focus on Fraud feature “Moss Adams...Ch. 4 - Prob. 8RQSCCh. 4 - Prob. 9RQSCCh. 4 - Prob. 10RQSCCh. 4 - Prob. 11RQSCCh. 4 - Prob. 12RQSCCh. 4 - Prob. 13RQSCCh. 4 - Prob. 14RQSCCh. 4 - Prob. 15RQSCCh. 4 - Prob. 16RQSCCh. 4 - Prob. 17RQSCCh. 4 - Prob. 18RQSCCh. 4 - Prob. 19RQSCCh. 4 - Prob. 20RQSCCh. 4 - Prob. 21RQSCCh. 4 - Able Corporation decided to make a public offering...Ch. 4 - KPMG (LO 1, 2, 3) KPMG LLP served as the external...Ch. 4 - ToshIba, EY (LO 1, 2, 3) In 2015, the business...
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- Individuals who believe they relied on misstated financial statements to make a decision andhave suffered losses as a result will issue an action known as aa. Breach of contract.b. Tort.c. Securities litigation.d. Constructive fraud.arrow_forwardWhat is the knowing misrepresentation of the truth in order to trick someone into entering into a contract? Fraud O Duress O Embezziement Mistakearrow_forwardWhen an employee is in a position to detect and hide fraudulent activity, incompatible obligations exist. False or True?arrow_forward
- Which of the following is a way to prove that a fraud was intentional? A. Show that the suspect repeatedly engaged in activity of an apparent wrongful nature (pattern evidence). B. Show that the suspect did not personally gain anything from the fraudulent act. C. Show that the suspect had a legitimate motive for their actions at issue. D. Show that the suspects failed to conceal evidence of the fraud.arrow_forwardWhat is an example of rationalization as one of the three elements causing a person to commit fraud?arrow_forwardRecognize the difference between dishonest financial reporting and the misuse of property. Compare and contrast the potential differences between these two forms of fraud as they pertain to the fair reporting of financial information.arrow_forward
- Which of the following is not an element necessary to prove professional negligence? a. There must be a duty to exercise professional care. b. There must be a breach of the duty. c. There must be a causal relationship between the breach of duty and a resulting injury. d. There does not need to be an actual loss or damage.arrow_forwardIn most fraud cases, ____________ is the most difficult element to prove, yet it is also the most important element. A. Concealment. B. Deception. C. Intent. D. Materiality.arrow_forwardTrue or False. The tort of defamation occurs when a person makes any statement that injures another’s reputation.arrow_forward
- Which of the following is not fraud: a. False accounting b. Computer fraud c. Copywrite d. Theftarrow_forwardGenerally, the auditor could be legally liable under? Select one: a. contract law but not under the tort of negligence to third parties b. the tort of negligence to the client and contract law c. the tort of negligence but not contract law to the client d. contract law to third parties and to the clientarrow_forwardDo you think that the provision of nonaudit services for a client with a failed audit is evidence of negligence? Explain.arrow_forward
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