When Would Auditors Increase the Amount of Detailed Audit Procedures

question 90

Multiple Choice

When would auditors increase the amount of detailed audit procedures used to test the year-end account balances and transactions from throughout the year?

• A)When the detection risk is low
• B)When the inherent risk is low
• C)When the control risk is low
• D)When the inherent risk in high

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Definitions:

Properly Drawn

A term indicating that a document, especially a legal document, has been prepared correctly and in accordance with all necessary formalities.

Endorsee

A person or entity to whom a negotiable instrument, such as a cheque or promissory note, is legally transferred through endorsement.

Bearer

An individual in possession of an instrument, such as a check or bond, that is payable to whoever holds it.

Negotiable Instrument

A paper that assures the payout of a certain sum of money, either when requested or at a predetermined time, with the document specifying the person responsible for payment.