If an Auditor Were to Audit a Payroll Application Using

question 29

Multiple Choice

If an auditor were to audit a payroll application using around-the-computer auditing techniques, the individual would:

• A)Use test data
• B)Verify that the output from the computerized processing was correct for the input data used to generate it
• C)Never use a surprise audit because of the amount of time and work involved
• D)Prepare a profile of a computer file and check the processed data with the profile thus obtained

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Definitions:

Common Stock

Ownership interest in a company, granting the right to participate in voting on company issues and to receive a share of the profits.

Net Income

The total amount of profit earned by a company after all expenses and taxes have been deducted from revenue.

Consolidated Financial Statements

Combined financial statements of a parent company and its subsidiaries, showing the financial results and financial position as if the group were a single entity.