Once the Auditor Has Decided on Procedures, the Acquisitions and Cash

question 22

Multiple Choice

Once the auditor has decided on procedures, the acquisitions and cash payments tests are typically performed:

• A) concurrently, to achieve efficiency without reducing the effectiveness of the tests.
• B) by different audit staff, to maintain independence.
• C) consecutively, to achieve efficiency without reducing the effectiveness of the tests.
• D) separately, to maximise the effectiveness of the tests.

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Definitions:

Weekly Interest Rate

The amount of interest charged or earned over a week, often used to describe the rate for loans or savings accounts on a weekly basis.

Disbursements

Payments made by a business in cash or cash equivalents, often pertaining to operating expenses.

Holding Cash

The practice of keeping a portion of assets in liquid cash form as a safeguard against uncertainty or to meet short-term obligations.