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Why must auditor review and obtain the client's approval of adjusting journal entries before posting them...

Why must auditor review and obtain the client's approval of adjusting journal entries before posting them to the trial balance? What should the auditor do if the client does not agree with the proposed adjustments?

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Answer #1

It is very much important for the auditor to take the approval of the client before posting adjusting journal entries in trial balance. As the management and client may have certain reservation and reasons for the adjusting entries, which are to be posted in trial balance.The auditor should find out the reasons because of which the client is not agreeing for the proposed adjustments. If the reasons are reasonable, viable and are material. It will be considered. If the reasons not viable, then it will reported to the proper level.

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