ISA 240 presumes that there are risks of fraud in:
APayroll and inventory
BRevenue recognitionCORRECT
CNon-current assets
DShare capital
ICANAudit & AssuranceAudit Risk and Risk Assessment2025
AI
Toaster Teacher
Why the answer is B, and why the others tempt you.
ISA 240 requires the auditor to presume a fraud risk in revenue recognition unless that presumption is rebutted and the reasons documented. The auditor must also address management override of controls in every audit.
Want this in Pidgin, Yoruba, Igbo or Hausa? Sign up free →
Practice more Audit & Assurance questions
ICAN Audit & Assurance has thousands more questions like this — with Worked answers on every one.