Substantive Tests Must Be Designed to Tests Specific Audit Objectives

question 38

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.
-Inspect major new additions to plant assets during the current period.

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

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Definitions:

z

A statistical measure that represents the number of standard deviations a data point is from the mean.

Normally Distributed Random Variable

A variable that follows a Gaussian distribution, characterized by its bell-shaped curve, where the mean, median, and mode are all equal.

Mean

The arithmetic average of a set of values or distribution.

Variance

A measure of the spread of a set of numbers, indicating how much the values differ from the mean of the set.