WGU C254 Topic 2 Questions | Questions with 100% Correct Answers | Verified | Latest Update

In the past (early 20th century time-frame), what was the general consensus of the principal purpose of audits (including among auditors)? - To detect fraud Why has there been so much frustration between the general public and auditors regarding fraud detection? - The public wants all cases of fraud detected, while auditors felt they only needed to be "reasonably certain" of its absence. Auditors can only say, with 100% certainty, that there is no fraud if they examine every transaction. Otherwise, there will always be some measure of doubt. - True AICPA and the Cohen Commission (the commission on auditor's responsibility) fought over something specific concerning the fall of Equity Funding in the 1970's. This conflict highlighted a major communication issue between auditors and financial statement users during much of the 20th century. What was this conflict about? - How much responsibility should the auditor take when endeavoring to detect (or fails to detect) fraud