Substantive Tests Must Be Designed to Tests Specific Audit Objectives

question 62

Multiple Choice

Substantive tests must be designed to tests specific audit objectives.
REQUIRED: For the following specific audit procedures, indicate the assertion that is being tested. Use the following letters, placing your response in the space provideD.
-Select vendor accounts with high activity during the year, and low balance at
year-end for confirmation.

• A)Existence or occurrence
• B)Completeness
• C)Valuation or allocation
• D)Rights and obligations
• E)Presentation and disclosure

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Definitions:

Absolute Scale

A scale of measurement that has a fixed zero point and equal intervals, allowing for meaningful comparisons and calculations.

Game Theory

A field of study focused on mathematical models of strategic interaction among rational decision-makers.

Strategic Decision Making

The process of making choices by identifying a decision, gathering information, and assessing alternative resolutions that align with a long-term goals.

Cooperative Games

A branch of game theory where players can negotiate and form coalitions to maximize their benefits.