In Cassette 12.4 (Amortize the "Drum" Slowly), Candid Production overvalued net assets by taking too little amortization.Which of the following was the lesson for the auditors in this case?
A)Check the client's calculations regardless of how simple they appear.
B)Understand special industry accounting before accepting an engagement.
C)Maintain professional skepticism when evaluating a client's accounting estimates.
D)Always investigate a client's background before accepting an engagement.

Question

Quizplus · Accepted Answer

The lesson for auditors was to maintain professional skepticism when evaluating a client's accounting estimates, as overvaluation can occur through understated amortization.