1. The most significant risks auditors face when management is rewarded on the basis of financial performance are

poor internal controls and inadequate closing procedures.

inadequate closing procedures, overstatement of income, and understatement of expenses.

inadequate closing procedures and smoothing of income.

management override and inadequate closing procedures.

2. If there is an unresolved going concern issue, the auditor will

evaluate the financial statements for fraud.

evaluate the financial statements for material misstatement.

evaluate the disclosure in the financial statements.

evaluate the financial statements for errors.

3. The responsibility to prepare a list of related parties and transactions is that of the

board of directors and client management.

auditor.

client management.

auditor and client management.

4he responsibility to evaluate the effectiveness of internal controls to prevent and detect fraud is that of the

client management.

auditor.

board of directors and client management.

auditor and client management.