Auditing standards (SAS No. 99 and SAS No. 54) require the auditor to communicate all management frauds and illegal acts to the audit committee:
A) only if the act is immaterial.
B) only if the act is material.
C) only if the act is highly material.
D) regardless of materiality.

Question

Quizplus · Accepted Answer

Auditing standards require the auditor to communicate all management frauds and illegal acts to the audit committee whether these acts are material or not. This communication is necessary to inform the audit committee of any unethical behaviors and to fulfill the auditor's responsibility to report any findings related to fraud or illegal acts. Thus, the correct answer is D - regardless of materiality.

Auditing Standards (SAS No