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to meet capital markets expectations that financial statements must not be tainted with material fraud and...

to meet capital markets expectations that financial statements must not be tainted with material fraud and in compliance with the new regulatory requirements of Sarbanes oxley, the external auditor will not be invovled to some extent in most investigations.

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Answer #1

Solution: The answer is FALSE

Reason:

1) To meet capital markets expectations, an organisation has to comply the following:

a) Financial Statement should be free from material frauds.

b) Has to be in compliance with regulations given by various government authorities.

In order to do so, an auditor have to involve to some extent in investigations relating to frauds and if possible the auditor can wait until the investigations are done, so that there may be chance to find any irregularities in those investigations. Which helps an auditor to perform his duties well.

So, An auditor should Involve in investigations.

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