Questions from Auditing and Assurance

Q: When an audit team traces a sample of shipping documents to the

When an audit team traces a sample of shipping documents to the related sales invoice copies, they are trying to find relevant evidence that a. Shipments to customers were invoiced. b. Shipments to cu...

Q: Write-offs of doubtful accounts should be approved by a

Write-offs of doubtful accounts should be approved by a. The salesperson. b. The credit manager. c. The treasurer. d. The cashier.

Q: The best way to enact a broad fraud prevention program is to

The best way to enact a broad fraud prevention program is to a. Install airtight control systems of checks and supervision. b. Name an “ethics officer” who is responsible for receiving and acting on f...

Q: When an audit team does not receive a response on a positive

When an audit team does not receive a response on a positive accounts receivable confirmation, a second request. b. Do nothing for immaterial balances. c. Examine shipping documents. d. Examine client...

Q: Cash receipts from sales on account have been misappropriated. Which of

Cash receipts from sales on account have been misappropriated. Which of the following acts would conceal this defalcation and be least likely to be detected by an auditor? a. Understating the sales jo...

Q: Cash receipts from sales on account have been misappropriated. Which of

Cash receipts from sales on account have been misappropriated. Which of the following acts would conceal this defalcation and be least likely to be detected by an auditor? a. Understating the sales jo...

Q: Which of the following internal control activities most likely would deter lapping

Which of the following internal control activities most likely would deter lapping of collections from customers? a. Independent internal verification of dates of entry in the cash receipts journal wi...

Q: What is lapping? What procedures can auditors employ to detect lapping

What is lapping? What procedures can auditors employ to detect lapping?

Q: The financial records of the Movitz Company show that R. Dennis

The financial records of the Movitz Company show that R. Dennis owes $4,100 on an account receivable. An independent audit is being carried out, and the auditors send a positive confirmation to R. Den...

Q: An auditor is required to confirm accounts receivable if the accounts receivable

An auditor is required to confirm accounts receivable if the accounts receivable balances are a. Older than the prior year. b. Material to the financial statements. c. Smaller than expected. d. Subjec...