Chapter 1 LO3

Question 1

Auditing of financial information reduces information risk to whom?

Answer 1

the users of financial information

Question 2

reflects the possibility that the information upon which a business decision was made was inaccurate…this is what kind of of risk?

Answer 2

information risK

Question 3

information risK reflects the possibility that the information upon which a _____ decision was made was inaccurate

Answer 3

business

Question 4

what is information risK?

Answer 4

reflects the possibility that the information upon which a business decision was made was inaccurate.

Question 5

T/F having an audit done on your financial statements helps reduce information risk and can have an affect on the interest rate of a loan

Answer 5

T

Question 6

the reduction of infor risk can have significan effect on the borrower ability to obtain capital at a _____ cost

Answer 6

reasonable