Chapter 4 Risk Assessment Already Passed

The disclosure of fraud to parties other than the entity's senior management and its audit committee ordinarily would be precluded by the auditor's ethical or legal obligations of confidentiality. However, the auditor DOES NOT have a duty to disclose the information to parties outside the entity such as {Ans: A Wall Street analyst inquiry regarding future profit projections}intangible assets such as musical, literary and artistic works, copyrights, trademarks and patents are all example of {Ans: Intellectual property}Auditor's responsibility to document the risk assessment {Ans: The documentation may include the use of questionnaires and Management's response to high-risk areas identified by the auditor should be included int he documentation}If the auditor assesses the ACHIEVED level of audit risk as being less than or equal to the {Ans: PLANNED level of audit risk, an unqualified report can be issued}Auditing standards require auditors to make certain inquiries of management regarding fraud {Ans: Required to ask whether management has any knowledge of fraud that has been perpetrated on or within the entity.}Risk factors relating to incentives/pressures to report fraudulent include {Ans: need to obtain debt or equity financing, high degree of competition or market saturation, and profitability expectations