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Which scenarios are illustrations of Control risk and why? Scenarios 1) A client fails to discover employee fraud on a timely basis because bank accounts
Which scenarios are illustrations of Control risk and why?
Scenarios 1) A client fails to discover employee fraud on a timely basis because bank accounts are not reconciled monthly 2) Cash is more susceptible to theft than an inventory of coal. 3) Confirmation of receivables by an auditor fails to detect a material misstatement. 4) Disbursements have occurred without proper approval. 5) There is inadequate segregation of duties. 6) A necessary substantive audit procedure is omitted. 7) Notes receivable are susceptible to material misstatement, assuming there are no related internal controls. 8) Technological developments make a major product obsolete. 9) The client is very close to violating debt covenants. 10) XYZ Company, a client, lacks sufficient working capital to continue operationsStep by Step Solution
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