Quest

ion1

Quest
iont
ext

ISA200st
atest
heov
eral
lobj
ect
ivesoft
heaudi
tor
.Thef
oll
owi
ngar
epossi
bleobj
ect
ivesoft
he
audi
tor
.

Whi
chopt
ion(
s)cor
rect
lyi
ndi
cat
e(s)t
heobj
ect
ivesofanaudi
tor
?

Not
ethatt
her
emaybemor
ethanonecor
rectopt
ion.

a.Di
scoverandpr
eventf
raud,
andensur
ethatt
heaudi
tcl
i
entcompl
i
eswi
thl
awsand
regul
ati
ons.

b.
Repor
tont
hefinanci
alst
atementsandcommunicat
easrequi
redbytheI
nter
nat
ional
St
andar
dsonAuditi
ng(I
SAs),i
naccordancewi
tht
heaudi
tor’
sfi
ndings.

c.
Provi
deassur
anceofthefut
urev
iabi
li
tyoft
heenti
tyandt
heef
fi
ciencywi
thwhi
cht
he
managementhasconduct
edtheaff
air
softheent
it
y.

d.
Obtainr
easonableassuranceaboutwhet hert
hefi
nancialst
atement
sasawhol ear
efreefrom
materi
almisstat
ement,whetherduetofraudorerr
or,t
herebyenabl
ingtheaudit
ortoexpressan
opi
niononwhet hert
hef i
nanci
alstat
ement sarepr
eparedinallmat
eri
alrespect
sinaccordance
wit
hanappl i
cablefi
nanci
alrepor
ti
ngf r
amewor k

Feedback

Thecor
rectanswer
sar
e:

Obtai
nreasonableassuranceaboutwhetherthefi
nancialstat
ementsasawhol earefr
eefrom
materi
almisstat
ement,whetherduet ofr
audorerror
,therebyenabl
ingtheaudit
ortoexpr
essan
opi
niononwhet hert
hef i
nancialst
atementsarepr
eparedi nallmat
eri
alrespect
sinaccor
dance
wit
hanappl i
cablefi
nancialr
eporti
ngframework,

Repor
tont hefi
nancialst
atementsandcommunicat
easrequi
redbyt
heI
nter
nat
ionalSt
andar
ds
onAudit
ing(ISAs)
,inaccordancewit
htheaudi
tor
’sf
indi
ngs.

Quest
ion2

Quest
iont
ext

Whi
chopt
ioncor
rect
lyexpl
ainswhatt
hest
akehol
dert
heor
yrepr
esent
s?

a.
Foranent
it
ytocont
inuet
oexi
st,
itmustexi
sti
nhar
monywi
thi
tsst
akehol
der
s.

b.
Itr
epr
esent
sther
elat
ionshi
pbet
weent
heowner
sandt
hedi
rect
orswher
econf
li
ctofi
nter
est
ar
isesasthedi
rect
orswhocont
rol
theent
it
ymaynotnecessar
il
yhav
ethebesti
nter
estoft
he
ownersathear
t.

c.
Anenti
tyi
sexpectedt
ohav
emor
alv
aluesandsoci
alr
esponsi
bil
i
tiesasi
tsact
ivi
ti
esi
nfl
uence
al
li
tsst
akehol
ders.

d.
Anent
it
yhasar
esponsi
bil
i
tyt
oser
venotonl
yit
sowner
sbutal
soi
tswi
derst
akehol
der
s.

Feedback

Thecor
rectansweri
s:

Anent
it
yisexpectedt
ohav
emor
alv
aluesandsoci
alr
esponsi
bil
i
tiesasi
tsact
ivi
ti
esi
nfl
uence
al
li
tsst
akehol
ders.

Quest
ion3

Quest
iont
ext

Whichoneoft hefol
lowingalter
nat
ivesi
sincor
recti
nrespectofther
olesofthevari
ouspar
ti
es
i
nanassur anceengagement ?Fort
hepurposeofthi
squestion,
assumet hatnoneofthe
sharehol
dersaredir
ectors.

a.
Thesharehol
dersappoi
ntaudi
torst
oexpr
essanopini
ononwhethertheassert
ionswhi
chare
madebythedirect
orstot
hesharehol
der
sinthef
orm oft
heannualf
inanci
alstat
ementsar
efai
r.

b.
Thedirect
orsareresponsibl
efortheprepar
ati
onoft
heannual
financi
alst
atement
sint
erms
ofanappropri
atefi
nancial
report
ingframework.

c.Thesharehol
der
srecei
vetheannualf
inancialst
atementsf
rom t
hedi
rect
orsandar
epor
tfr
om
theaudit
orsonthefai
rpresent
ati
onofthefinanci
alstat
ements

d.
Theshar
ehol
der
sareresponsi
blef
orr
unni
ngthecompanyandr epor
tingther
esul
tsoft
hei
r
st
ewar
dshipt
othedi
rect
orsbywayofasser
ti
onsintheannual
financi
alstat
ements

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Thecor
rectansweri
s:

Thesharehol
der
sareresponsi
blef
orrunni
ngt hecompanyandreporti
ngtheresul
tsoft
hei
r
st
ewardshipt
othedir
ectorsbywayofassert
ionsintheannualf
inanci
alst
atements

Quest
ion4
Quest
iont
ext

Whi
choneoft
hef
oll
owi
ngi
snotani
nher
entl
i
mit
ati
onofanaudi
t?

a.
Theaudi
tfeemaynotcov
ert
het
imespentont
heaudi
tandt
hewor
kdonet
obeabl
etoobt
ain
compl
eteassur
ance

b.
Thet
imel
i
nessoff
inanci
alr
epor
ti
ngandt
hebal
ancebet
weenbenef
itandcost

c.
Thenat
ureofaudi
tpr
ocedur
es

d.
Audi
tev
idencei
susual
l
yper
suasi
ve,
rat
hert
hanconcl
usi
ve

Feedback

Thecor
rectansweri
s:

Theauditf
eemaynotcov
ert
het
imespentont
heaudi
tandt
hewor
kdonet
obeabl
etoobt
ain
complet
eassur
ance

Quest
ion5

Quest
iont
ext

Whichofthefol
lowi
ngopt
ionsdescr
ibesway
stoaddr
esst
heexpect
ati
ongapbet
weensoci
ety
andtheaudit
or?

Pl
easenot
ethatt
her
ecoul
dbemor
ethanonecor
rectopt
ion.

a.Propercommunicat
ionwit
hthepubl
i
crel
ati
ngt
oaudi
trequi
rement
sandchangest
o
regulat
ionsandst
andards

b.
Addr
essi
ngaudi
tqual
i
tyi
ssues

c.
Prov
idi
ngabsol
uteassur
ancet
osoci
etyt
hatt
hef
inanci
alst
atement
sofanent
it
yar
efr
ee
fr
om mater
ial
misst
atement

d.
Bei
ngmi
ndf
ulofsoci
ety
’sexpect
ati
onswhenset
ti
ngnewpol
i
cies

Feedback

Thecor
rectanswer
sar
e:

Propercommunicati
onwit
hthepubl
i
cr elati
ngtoaudi
trequi
rementsandchangestoregul
ati
ons
andstandar
ds,
Addressi
ngaudi
tqual
it
yi ssues,
Bei
ngmindfulofsoci
ety’
sexpect
ati
onswhen
sett
ingnewpol
icies
Quest
ion6

Quest
iont
ext

Theaudit
orhastodrawonpastexper
iencewhenassessi
ngjudgement
saboutt
hefutureand
mayassumet hati
nthecont
extofanongoingaudi
tengagementatt
hesamecli
ent“
things
gener
all
ystaythesame”
.

Towhi
choft
heaudi
tpost
ulat
esdoest
hisst
atementr
efer
?

a.
Appl
i
cat
ionofgener
all
yaccept
edaccount
ingpr
act
icer
esul
tsi
nfai
rpr
esent
ati
on

b.
Thatwhi
chhel
dtr
uei
nthepastwi
l
lhol
dtr
uei
nthef
utur
e

c.
Thefi
nancial
stat
ementssubmi
tt
edt
otheaudi
torf
orv
eri
fi
cat
ionar
efr
eeofcol
l
usi
veand
ot
herunusuali
rr
egul
ari
ti
es

d.
Nonecessar
yconfl
ictofi
nter
estexi
stsbet
weent
heaudi
torandt
hemanagement
/empl
oyees
oft
heenter
pri
seunderaudi
t

Feedback

Thecor
rectopti
oncorrect
lydescr
ibestheauditpost
ulat
erefer
ri
ngtothef
actt
hatt
heaudi
tor
mayassumet hatatt
hesameaudi tcl
ientt
hingsgeneral
lyst
aythesame.

Theotheropti
onsar
ealsoaudit
ingpost
ulat
esassuggest
edbyMaut
zandShar
af,
butdescr
ibes
di
ff
erentfundament
alpri
nci
ples

Thecor
rectansweri
s:

Thatwhi
chhel
dtr
uei
nthepastwi
l
lhol
dtr
uei
nthef
utur
e

Quest
ion7

Quest
iont
ext

Wit
hwhichoft
hefol
l
owingrequi
rementsshoul
danindi
vidual
whowishest
obecomeamember
oft
heSouthAf
ri
canInst
it
uteofChar
ter
edAccount
ants(SAICA)compl
y?

Youshouldchooseal
ltheopt
ionsr
epr
esent
ingr
equi
rement
sthatshoul
dbemeti
nor
dert
o
regi
sterasamember.

a.
Obt
ainar
ecogni
sedqual
i
ficat
ionf
rom anaccr
edi
teduni
ver
sit
y.

b.
Sat
isf
yther
equi
rement
soft
heAudi
tDev
elopmentPr
ogr
ammesubsequentt
omeet
ingt
he
r
equi
rement
sforr
egi
str
ati
onasachar
ter
edaccount
ant
.

c.
Passt
heIni
ti
altestofCompetence(
ITC)exami
nat
ionandt
heAssessmentofPr
ofessi
onal
Compet
ence(APC)examinat
ion

d.
Compl
eteat
rai
ningcont
racti
npubl
i
cpr
act
ice

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Thecor
rectanswer
sar
e:

Obtai
nar ecognisedqual
i
ficati
onfrom anaccr
edi
teduni
v er
sit
y.,
PasstheI
nit
ialtestof
Compet ence(ITC)exami
nationandtheAssessmentofProfessi
onalCompetence( APC)
examination,
Completeatr
ainingcont
racti
npubli
cpract
ice

Quest
ion8

Quest
iont
ext

Anassert
ionisdefi
nedi nISA315asr epresentat
ionsofmanagement
,expl
ici
torotherwise,
that
ar
eembodi edinthefinancial
st atements.Assert
ionsar
eusedbytheaudit
ortoconsiderthe
di
ff
erentt
y pesofpotenti
almi sstatementsthatmayoccur.

Whichone(
ormor e)oft
hefol
lowi
ngasserti
onsdefi
nedinISA315appl
i
es/
appl
ytobot
h
cl
assesoft
ransacti
onsandev
ents,andaccountbal
ances?

a.
classi
fi
cat
ion

b.
occur
rence

c.
compl
eteness

d.
cut
-of
f

Feedback

Thecor
rectanswer
sar
e:

compl
eteness,
cl
assi
fi
cat
ion

Quest
ion9

Quest
iont
ext

Whi
choneoft
hef
oll
owi
ngopt
ionscor
rect
lydescr
ibest
heov
eral
lobj
ect
ivesoft
heaudi
tor
?
a.
Obtai nreasonableassuranceaboutwhet herthefinancialst
atementsasawhol earefr
eefrom
materialmisstatement,whetherduetof raudorer ror,t
herebyenabli
ngtheauditort
oexpressa
conclusiononwhet herthef i
nanci
alstatement sarepr epared,i
nallmateri
alr
espects,
in
accordancewi thanapplicablefi
nancialreporti
ngf ramewor kandtoreportonthefi
nanci
al
stat
ement sandcommuni cateasrequir
edbyt heISAs, i
naccordancewi t
htheaudit
or’
sfindi
ngs.

b.
Obtainl
imitedassuranceaboutwhet herthefi
nancialstat
ementsasawhol ear efreefrom
materi
almisstat
ement ,
whetherduet of r
audorerror,t
herebyenabli
ngtheaudi t
ort oexpr essan
opi
niononwhet hert
hef i
nancial
statement sar
epr epared,i
nallmateri
alrespects,inaccor dance
wit
hanappl i
cablefi
nancialr
eporti
ngframewor k(e.g.
,IFRS)andtoreportont hefinancial
st
atementsandcommuni cateasrequiredbytheISAs,inaccordancewitht heauditor’
sf i
ndings.

c.
Obtainabsolut
eassur anceaboutwhet herthefi
nanci
al statementsasawhol earefreefrom
materi
almisstat
ement , whetherduet ofraudorerr
or,t
her ebyenabli
ngtheaudi tortoexpressan
opi
niononwhet herthef inanci
alstatement sar
eprepared, i
nallmateri
alrespects,inaccordance
wit
hanappl i
cablefinancialrepor
tingframewor kandtorepor tonthefi
nanci al
st at
ementsand
communicateasr equiredbyt heISAs, i
naccordancewitht heaudit
or’
sfindings.

d.Obtainr
easonabl eassur anceaboutwhet herthefi
nancialst
atementsasawhol earefreefrom
mat eri
almisstat
ement , whetherduet ofraudorer r
or,t
herebyenabli
ngtheaudi tort oexpressan
opiniononwhet herthef inanci
alstatement sareprepared,i
nallmateri
alrespects, i
naccor dance
withanappl i
cablefinancialrepor
tingframewor kandtoreportonthefi
nanci al
st atementsand
communi cateasr equiredbyt heISAs, i
naccor dancewiththeaudit
or’
sfindings.

Feedback

Thecor
rectansweri
s:

Obtai
nreasonableassur anceaboutwhet herthefinancialstat
ementsasawhol earefreefrom
materi
almisstat
ement , whetherduet ofraudorer ror
,therebyenabli
ngtheaudi tortoexpressan
opi
niononwhet herthef inanci
alstatement sareprepared, i
nallmateri
alrespects,inaccordance
wit
hanappl i
cablefinancialrepor
tingframewor kandtor eportonthefi
nanci alstat
ement sand
communicateasr equiredbyt heISAs, i
naccor dancewi ththeaudi
tor’
sfindings.

Quest
ion10

Quest
iont
ext

Whi
chcombinati
onofthechar
act
eri
sti
csbel
owrepresentst
hecorr
ectexpl
anat
ionofa
r
epor
tabl
eir
regul
ari
ty,
asdefi
nedi
ntheAudit
ingPr
ofessionAmendmentAct?

a.Hascausedorisli
kel
ytocausemater
ial
financiall
osstotheenti
tyort
oanypart
ner,member,
sharehol
der,
credi
torori
nvest
oroft
heenti
ty,inrespectofhi
s/her
/i
tsdeal
ingswi
ththatent
it
y;
duet
onegl
igenceoft
hef
inanci
alaccount
ant
;unl
awf
ulactoromi
ssi
on;
isf
raudul
entor
amount
stotheft
.

b.
Hascausedori slikel
yt ocausemater
ial
financi
all
osstoSARS,i
nrespectofhis/
her/
it
s
deal
ingswiththatentit
y;commi t
tedbyt
hefinanci
alaccount
ant
;unl
awfulactoromissi
on;i
s
fr
audulentoramount stotheft
.

c.Hascausedorislikelyt
ocausemateri
alf
inanci
all
osstot heshar
ehol
dersoftheent
it
y,i
n
respectofhis/
her/
itsdeali
ngswit
hthatent
it
y;committedbyanyemployeeinthecompany;
unlawfulactoromission;
isfr
audul
entoramountstotheft
.

d.Hascausedori sli
kel
ytocausemateri
alfinanciall
osst otheenti
tyortoanypar
tner
,member,
shareholder
,credi
torori
nvest
oroftheenti
ty,inrespectofhis/her
/i
tsdeali
ngswit
hthatent
it
y;
duet othenegli
genceofthefi
nanci
aldi
rector;unlawfulactoromission;
isfr
audul
entor
amount stotheft.

Feedback

Thecor
rectansweri
s:

Hascausedori sl
ikel
ytocausemat eri
alfi
nanci
allosstotheent i
tyortoanypartner,member,
shar
eholder
,credi
torori
nvestoroftheenti
ty,i
nrespectofhis/her/i
tsdeal
ingswiththatent
it
y;
duetothenegli
genceofthefinanci
aldir
ector
;unlawfulactoromi ssi
on;i
sf r
audulentor
amountstotheft.

Quest
ion11

Quest
iont
ext

Whichoneofthefol
lowi
ngst
atement
sisnotcor
rectaboutt
hepr ocedurestheboardofa
companyhastofoll
owwhenappoi
nti
nganaudit
orwhereav acancyarisesduri
ngthecourseof
thefi
nanci
aly
ear?

a.Theboardmustproposet
ot hecompany’
saudi
tcommitteet
henameofatleastone
register
edaudi
tort
obeconsideredf
orappoi
ntmentwi
thi
n15businessday
saftert
hevacancy
arises.

b.
Theboar
dmustappointt
heproposedaudit
orift
heyhav
enotrecei
vedr
eject
ioni
nwr
it
ing
fr
om t
heaudi
tcommit
teewithi
nfi
vebusinessdaysoft
heproposal
.

c.
Theboar
dmustappoi
ntanewaudi
torwi
thi
n40busi
nessday
soft
hev
acancyar
isi
ng.

d.
Theauditcommi tt
eemustappoi
ntt
heaudi
torpr
oposedbyt
heboar
dwi
thi
nfi
vebusi
ness
daysoft
hepr oposal
.
Feedback

Thecor
rectansweri
s:

Theaudi
tcommitt
eemustappoi
ntt
heaudi
torpr
oposedbyt
heboar
dwi
thi
nfi
vebusi
nessday
s
oft
heproposal
.

Quest
ion12

Quest
iont
ext

Rev
iewt
hecomposi
ti
onoft
heboar
dofdi
rect
orsofGar
den(
Pty
)Lt
d:

Chi
efexecut
iveof
fi
cer
: MrHWoody(
Hei
ncor
por
atedt
hecompany12y
ear
sago.
)

Fi
nanci
aldi
rect
or: Mr
sGNgomo(
Shei
sCA(
SA)andt
hesi
sterofMrWoody
.)

HumanResour
cedi
rect
or:
MrsAJoy

Non-
execut
ivedi
rect
or: MrFNai
doo(
Hei
sindependentoft
hecompany
.)

Non-
execut
ivedi
rect
or: Mr
sJBot
ha(
Shei
sadi
rect
orofGar
den(
Pty
)Lt
d’smai
nsuppl
i
er.
)

Non-
executi
vedi
rect
or: MrKBanks( Hewast
hefi
nanci
aldi
rect
orofGar
den(
Pty
)Lt
dunt
il
f
ouryearsago,
withnoot
herr
elat
ionshi
ptot
hecompany.
)

Whooft
hedi
rect
orsofGar
den(
Pty
)Lt
dcoul
dbeappoi
ntedt
othecompany
’saudi
tcommi
tt
ee?

a.
MrsNgomo,
MrNai
doo,
MrsBot
haandMrBanks

b.
MrNai
dooandMrBanks

c.
MrNai
doo,
MrsBot
haandMrBanks

d.
MrsNgomo,
MrNai
dooandMr
sBot
ha

Feedback

Thecor
rectansweri
s:

MrNai
dooandMrBanks
Quest
ion13

Quest
iont
ext

Aftertwomonthsofwai
ti
ngforconfi
rmat
ionofamountsowi
ngtoasuppl
i
er,
Sal
l
y( acandi
date
auditor
)coul
dnotver
if
ytheamountpayable.Howev
er,
sheconcl
udedont
hewor
kingpaperthat
theauditpr
ocedur
eswereadequat
elyper
formed.

Whichofthef
oll
owingstat
ement
sis/
arecor
recti
nter
msoft heSAI
CACodeofPr
ofessi
onal
Conduct
?Notethatther
ecoul
dbemorethanonecorr
ectst
atement
.

a.
Sal
l
ybr
eachedt
hepr
inci
pleofobj
ect
ivi
tyf
orf
ail
i
ngt
ocar
ryouti
mpor
tantaudi
twor
k.

b.
Sal
l
ydidnotactwit
hprofessi
onalcompetenceandduecar
easshedi
dnotacti
naccor
dance
wi
ththet
echni
calandpr
ofessional
standar
ds

c.
Sal
lydi
dnotactwithi
ntegr
it
ybecauseshefail
edtoconf
ir
m whet
herthecompany’
sli
abi
l
ity
wasaccur
atel
yrecor
ded,andshewasdishonesti
ntheconcl
usi
onoftheworki
ngpaper

d.
Sall
ydidnotcompl
ywi
tht
hepr
inci
pleofpr
ofessi
onal
behav
iourasshedi
scr
edi
tedt
he
pr
ofessi
on

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Thecor
rectanswer
sar
e:

Sal
lydi
dnotactwithprofessi
onalcompetenceandduecar
easshedi
dnotacti
naccor
dance
wit
hthetechni
calandprofessi
onalst
andards,

Sall
ydidnotcompl
ywi
tht
hepr
inci
pleofpr
ofessi
onalbehav
iourasshedi
scr
edi
tedt
he
prof
ession,

Sall
ydidnotactwithint
egri
tybecauseshef ai
ledtoconf
ir
m whet
hert
hecompany’
sli
abi
l
itywas
accurat
elyr
ecorded,andshewasdi shonestintheconcl
usi
onoft
heworki
ngpaper

Quest
ion14

Quest
iont
ext

Matchthecor
rectdescr
ipt
ionoft
hef
oll
owi
ngt
hreat
stocompl
i
ancewi
tht
hef
undament
al
pr
inci
ples:

Apr
ofessi
onal
account
antl
obbi
esi
nfav
ourofl
egi
slat
iononbehal
fofacl
i
ent
.
Answer1

Sel
f-
int
erestt
hreat

Apr
ofessional
accountanthasprepar
edtheori
ginal
dat
ausedt
ogener
atet
her
ecor
dst
hatar
e
t
hesubjectmatteroft
heassuranceengagement.

Answer2

Sel
f-
rev
iewt
hreat

Prof
essionalaccountantsquotealowfeetoobtainanewengagement,butt
hefeeissolow
t
hatitmightbediffi
cultt
oper f
ormtheprofessi
onalser
vicei
naccor
dancewithappl
i
cable
t
echnicalandprofessi
onalstandar
dsofpracti
ce.

Answer3

Adv
ocacyt
hreat

Apr of
essi
onal
accountantaccept
edasi
gni
fi
cantgi
ftf
rom acl
i
entandt
hreat
enedt
hat
accept
anceoft
hegiftwil
lbemadepubli
c.

Answer4

I
nti
midat
iont
hreat

Apr
ofessi
onal
account
anthasacl
osef
ami
l
ymemberwhoi
sthedi
rect
oroft
hecl
i
ent
.

Answer5

Fami
l
iar
it
ythr
eat

Feedback

Thecor
rectansweri
s:

Aprof
essi
onalaccount
antl
obbi
esi
nfav
ourofl
egi
slat
iononbehal
fofacl
i
ent
.→ Adv
ocacy
t
hreat
,

Apr
ofessionalaccountanthasprepar
edtheori
ginaldat
ausedtogener
atet
her
ecor
dst
hatar
e
t
hesubjectmatteroftheassuranceengagement.→ Sel
f-r
evi
ewthr
eat,

Professionalaccountantsquotealowfeet oobtai
nanewengagement ,butt
hefeei
ssolow
thatitmightbedi f
fi
culttoperfor
mt heprofessi
onalser
viceinaccordancewi
thappl
i
cabl
e
technicalandprofessionalst
andardsofpracti
ce.→ Sel
f-int
erestt
hreat,
Aprofessionalaccount
antaccept
edasi
gni
fi
cantgi
ftf
rom acl
ientandt
hreat
enedt
hat
acceptanceofthegiftwil
lbemadepubl
i
c.→ I
nti
midat
ionthr
eat,

Aprofessionalaccount
anthasacl
osef
ami
l
ymemberwhoi
sthedi
rect
oroft
hecl
i
ent
.→
Famil
i
ar i
tythreat

Quest
ion15

Quest
iont
ext

Whi
choneoft
hef
oll
owi
ngi
snotanel
ementofasy
stem ofqual
i
ty-
cont
rol
management
?

a.
Rel
evantet
hical
requi
rement
s

b.
Gov
ernanceandl
eader
shi
p

c.
Engagementper
for
mance

d.
Humanr
esour
ces

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Thecor
rectansweri
s:

Humanr
esour
ces.