Auditing standards specifically require auditors to identify ________ as a fraud risk in most audits.
A)overstated assets
B)understated liabilities
C)improper revenue recognition
D)overstated expenses

Question

Quizplus · Accepted Answer

Auditors are specifically required to identify improper revenue recognition as a fraud risk in most audits, as revenue is a critical component of a company's financial statements and can be easily manipulated to overstate the company's financial results. While overstated assets, understated liabilities, and overstated expenses can also be indicative of fraud, they may not be as commonly identified or required to be specifically considered by auditing standards.

Auditing Standards Specifically Require Auditors to Identify ________ as a Fraud