Auditors should plan and perform their audits to provide reasonable assurance of detecting material misstatements in financial statements, including those resulting from fraud. a. Distinguish between fraudulent financial reporting and misappropriation of

a. Compliance audit - a government auditor is likely to perform the audit engagement as the Food and Drug Administration is a regulatory body. b. Financial statement audit - an external auditor is likely to perform the audit engagement as it involves the fair presentation of financial statements. c. Audit of internal control - an internal auditor is likely to perform the audit engagement as it involves reviewing the payment procedures of an accounts payable department. d. Forensic audit - a forensic auditor is likely to perform the audit engagement as it involves examining financial records to determine if any accounting irregularities have occurred. e. Operational audit - an internal auditor is likely to perform the audit engagement as it involves evaluating the feasibility of forecasted rental income for a planned low-income public housing project. f. Audit of internal control - an internal auditor is likely to perform the audit engagement as it involves evaluating a company's computer services department in terms of the efficient and effective use of corporate resources. g. Tax audit - an external auditor is likely to perform the audit engagement as it involves auditing the partnership tax return of a real estate development company. h. Forensic audit - a forensic auditor is likely to perform the audit engagement as it involves investigating the possibility of payroll fraud in a labor union pension fund.