118. In every audit, which of the following must be identified as a potential risk of material misstatement due to fraud? A. Management override of controls. Answer (A) is correct. The auditor should address the risk of management override of controls in all audits because of its unpredictability and ordinarily should assume the existence of a fraud risk relating to improper revenue recognition. In the second case, the contrary conclusion must be documented. Accordingly, even if specic fraud risks are not identified, the possibility of management override of controls is always deemed to exist. AU-C 240 states that the auditor's procedures should address that risk apart from any conclusions regarding the existence of more specifically identiable risks. B. Improper revenue recognition. C. Collusion. D. Falsification of documentation