Which of the following statements is correct with respect to the auditor's responsibilities relative to the detection of indirect-effect illegal acts?
A) The auditor has no responsibility for searching for indirect-effect illegal acts.
B) The auditor has the same responsibility for searching for indirect-effect illegal acts as any other potential misstatement that may occur.
C) Auditors have responsibility for searching for any illegal act, whether direct-effect or indirect-effect.
D) Discovery of indirect-effect illegal acts is usually easier than discovery of fraud.

Question

Quizplus · Accepted Answer

Auditors are not responsible for actively searching for indirect-effect illegal acts, as these do not have a direct impact on the financial statements. Their responsibility is primarily focused on direct-effect illegal acts that could materially affect the financial statements.

Which of the Following Statements Is Correct with Respect to the Auditor's