For a CPA to be liable for damages under the antifraud provisions of Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934, a plaintiff must prove all of the following except that
A. The plaintiff relied on the financial statements audited by the CPA.
B. The CPA violated generally accepted auditing standards.
C. There was a material omission or misstatement of fact in the financial statements audited by the CPA.
D. The CPA acted with scienter.
Answer: B. The CPA violated generally accepted auditing standards.
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The analytic hierarchy process:
A) optimizes procedures with a single goal. B) requires no pairwise comparison. C) uses both qualitative and subjective assessment. D) does not require the input of a decision maker.
Which of the following is a factor that relates to attitudes or rationalization to misappropriate assets?
A) significant accounting estimates involving subjective judgments B) excessive pressure for management to meet debt repayment requirements C) a sense of superiority by executives D) high turnover of accounting, internal audit and information technology staff