Which of the following is an example of an audit risk? The client...
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Accounting
- Which of the following is an example of an audit risk?
- The client is being sued by a customer for a defective product and if they lose, the compensation awarded is likely to be significant.
- The client is being sued by a customer for a defective product with the publicity of the case damaging their reputation.
- The client will have to spend a significant amount of money on improving their quality control procedures to avoid the same defects occurring again.
- Provisions may be understated if the probable liability resulting from the court case is not recognised in the financial statements.
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You can see the logs in the Dashboard.