Auditing standards require that the auditor presume that there is a risk of fraud in revenue recognition.

Question

Quizplus · Accepted Answer

Auditing standards require the auditor to presume that there is a risk of fraud in revenue recognition due to the potential for management to manipulate or misstate revenue figures. This presumption of risk requires the auditor to conduct more extensive testing and obtain sufficient evidence to support the accuracy and completeness of revenue recognition.

Auditing Standards Require That the Auditor Presume That There Is