Question

Please provide answers next to the questions provided. Most questions can be answered with 3 or less sentences, but please do not exceed 5 sentences.

Explain how testing for occurrence and completeness would be different.

If you are the financial statement auditor, which audit objective is the most crucial when testing accounts payable? Explain your answer.

Mention one kind of audit evidence would you want to gather to satisfy the audit objective you chose in answering the previous question. Make sure you use the terminology from Chapter 7 when explaining which evidence you would gather.

Answer 1

Auditing for completeness addresses the main auditing objective that is the most vital part of the accounts payable auditing process. This is to check whether all the purchases have been recorded or not. It is easy to increase company's net income by not recording the payables. Many thefts occur in this area.

Cut off test is one of the audit procedure that could be performed . In cut off test the auditor ensures that transactions for the accounting year has been included in the year end financial statements.