Internal Control and Risk Assessment Practice Question

Question

A professional is deciding the best next action for the CPA AUD Auditing and Attestation involving subsequent events in Internal Control and Risk Assessment. Which answer is best? (Item 154)

Answer choices

1. A. Escalate only after taking irreversible action without reviewing the facts.
2. B. The best answer is to select the audit response that best supports sufficient appropriate evidence, professional skepticism, and proper reporting for the subsequent events scenario.
3. C. Treat all similar terms as interchangeable without checking the scenario context.
4. D. Choose an answer that removes accountability from the responsible professional.

Correct Answer

B. The best answer is to select the audit response that best supports sufficient appropriate evidence, professional skepticism, and proper reporting for the subsequent events scenario.

Explanation

The correct answer is B because subsequent events is tested by asking candidates to select the audit response that best supports sufficient appropriate evidence, professional skepticism, and proper reporting. The distractors reflect common exam mistakes: ignoring context, using informal shortcuts, skipping verification, or applying a rule from the wrong domain.

Question details

• Difficulty: medium
• Domain: Internal Control and Risk Assessment
• Objective: subsequent events

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