In the HealthSouth case, the auditors failed to meet their ethical and professional obligations because they failed to uncover fraud in which account?
A) Inventory
B) Contractual allowance
C) Sales returns
D) All of these

Question

Quizplus · Accepted Answer

The auditors failed to meet their ethical and professional obligations in relation to the contractual allowance account, which contained fraudulent entries. They also failed to adequately test the allowance for doubtful accounts, leading to material misstatements in the financial statements. There is no evidence to suggest that they failed to uncover fraud in inventory or sales returns.

In the HealthSouth Case, the Auditors Failed to Meet Their