Question

Which of the following procedures would be considered a test of controls? Auditor reviews the check...

Which of the following procedures would be considered a test of controls?

Auditor reviews the check register for unrecorded liabilities

Auditor verifies client calculation of unexpired insurance premium.

Auditor reviews purchase orders for indication of supervisor approval

Auditor confirms all all customer receivable balances over $50,000

Homework Answers

Answer #1

"Auditor reviews purchase orders for indication of supervisor approval" would be considered as test of controls. The control that is being tested here is the control which is the Approval of supervisor for releasing purchase orders.

The other cases would be considered as Substantive testing which is basically performed to detect misstatement or fraud at the assertion level.

Check register is a document and the same is checked for ensuring completeness of the balance of Unrecorded liabilities.

Calculation of unexpired insurance premium is verified for ensuring completeness of the balance unexpired insurance premium and accuracy of insurance premium charged off.

Confirmation from Customers over receivable balances is done to ensure the assertion of existence and rights & obligations of the Receivable balances

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Items 1 through 10 represent possible errors and fraud that an auditor suspects are present. The...
Items 1 through 10 represent possible errors and fraud that an auditor suspects are present. The accompanying List of Auditing Procedures that the auditor would consider performing to gather evidence concerning possible errors and fraud. For each item, select one or two procedures, as indicated, that the auditor most likely would perform to gather evidence in support of that item and explain why you choose. Possible misstatements due to error and fraud 1. The auditor suspects that the controller wrote...
   Which of the following choices is not used to modify the chart of accounts? a.       Deleting accounts...
   Which of the following choices is not used to modify the chart of accounts? a.       Deleting accounts with balances b.      Adding new accounts c.       Editing accounts d.      Deleting unused accounts 2.      All of the following task may be completed in the banking section of the Home page except: a.       Receive Items b.      Write Checks c.       Reconcile Accounts d.      Make Deposit The one-step approach should not be used to pay the following: Sales Taxes Expenses, such as rent, utilities and insurance Bills for non-inventory items such as office supplies Bills...
Problem 1 You are an internal audit manager in a central government department that pays subsidies...
Problem 1 You are an internal audit manager in a central government department that pays subsidies to agricultural businesses involved in the production of basic foodstuffs. You will soon be undertaking an internal audit of the claims processing unit in your department. In preparation for the assignment you are reviewing the audit file on the previous audit carried out three years earlier. You find the following extract from one of the previous internal audit’s planning schedules: • “The unit receives...
During the trial, lawyers for the accused said that the men believed that the accounting decisions...
During the trial, lawyers for the accused said that the men believed that the accounting decisions they made were appropriate at the time, and that the accounting treatment was approved by Nortel’s auditors from Deloitte & Touche. Judge Marrocco accepted these arguments. Marrocco added he was “not satisfied beyond a reasonable doubt” that the trio (i.e., Dunn, Beatty, and Gollogly) had “deliberately misrepresented” financial results. Given the facts of the case, do you believe Judge Marrocco’s decision was justified? Explain....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT