In auditing accounts receivable, the “negative” form of confirmation request most likely would be used...
In auditing accounts receivable, the “negative” form of confirmation request most likely
would be used when
a. Accounts receivable consist of a
number of accounts with large customer balances.
b. Control Risk and Inherent Risk are
assessed to be High.
c. Recipients are likely to return positive confirmation requests without verifying the accuracy of the
information.
d. The auditor is not aware of
circumstances or conditions that would cause recipients of
negative
confirmation requests to disregard such requests.
Homework Answers
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In auditing accounts receivable, the “negative” form of
confirmation request most likely
would be used...
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An auditor who is auditing accounts receivable would least likely perform which of the following tests?...
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auditing
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Confirmation of accounts receivable is presumptively mandatory audit procedure. In performing this procedure, auditors use positive confirmation requests or negative confirmation requests or a combination of both. Which confirmation provides auditors with more accurate assurance, and why? (2 marks) B. Describe two conditions which should exist for the auditors to use the negative form of request. (4 marks) C. If a response is not received to an initial positive confirmation request, describe two actions that should be taken by the...
auditing
Part Two: Multiple Choice Questions: (2.5 marks/ question) 1. To test the existence assertion for recorded receivables, an auditor would select a sample from the A) Sales orders file. B) Customer purchase orders C) Accounts receivable subsidiary ledger D) Shipping documents (bill of lading) file. 2. When control risk for the existence assertion is assessed at a high level, which of the Gallerine is a likely effect with respect to the auditors' confirmation of receivables? A) The account balances...
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