Weekly Assignment for Chapter 4: Management Fraud and Audit Risk 1. Give an example of an error or fraud that would misstate financial statements to affect the accounts as follows, taking each case independently. (Note: "Overstate" means the account has a higher value than would be appropriate under GAAP and "understate" means it has a lower value) Overstate one asset; understate another asset. Overstate an asset; overstate stockholders' equity. Overstate an asset; overstate revenue. Overstate an asset; understate an expense. Overstate a liability; overstate an expense. Understate an asset; overstate an expense. Understate a liability; understate an expense. 2 Compliance with Laws and Regulations. Audit standards dist auditors responsibility for planning noncompliance with laws and regulations having a direct effect on financia procedures for detecting