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I have seen risk of error, risk of fraud, risk of manipulation and risk of management bias repeatedly appear in the sample answer for past exam paper. I am just wondering how they interact with each other and whether my below understanding is correct.
1. Material mistatement could be caused by error, fraud, manipulation and management bias.
2. Risk of error, fraud and manipulation could be caused by management bias. Is it correct?
3. What does management bias mean exactly?
Please see Chapter 8 of the OpenTuition notes.
2. Error is unintentional mistake – I would say caused by carelessness, etc (rather than management bias). I would say that risks of fraud/manipulation are increased by management bias (bias may not be conscious) rather than caused by (which suggests deliberate).