In Auditing Investments, Auditors May Compare Current-Year and Prior-Year Balances

question 73

Multiple Choice

In auditing investments, auditors may compare current-year and prior-year balances or compare actual results for the amount of investments and investment income with budgets or the documentation of management's plans. Unexpected differences would would be least likely to pertain to assertions about:

• A) existence of occurrence.
• B) completeness.
• C) rights and obligations.
• D) valuation or allocation.
• E) presentation and disclosure.

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Definitions:

Adjustment

Entries made in accounts to correct errors or allocate income and expenses to the correct accounting period.

Worksheet

A paper or digital document with problems or questions for students to complete as part of their learning.

Financial Statement

A formalized register of financial interactions and the fiscal status of an enterprise, an individual, or a separate entity.

Depreciation Expense

Allocating the value of a tangible asset evenly over its period of usefulness in a systematic manner.