The Audit Plan Includes the Nature,timing,and Extent of Audit Procedures

question 49

Multiple Choice

The audit plan includes the nature,timing,and extent of audit procedures for the purposes of risk assessment,including those that are linked to the individual audit assertions,as well as any other audit procedures that are considered necessary.At what point in the audit process is the audit plan finalized?

• A)When the auditor has finished documenting internal controls.
• B)When the client risk profile has been completed.
• C)When risk assessments are complete.
• D)When inherent risk information has been gathered.

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Definitions:

Supplies Expense

The cost associated with the consumption of supplies used in the operations of a business during an accounting period.

Equipment

Fixed assets used in operations, such as machinery, computers, and furniture, which have a useful life of more than one accounting period.

Adjusting Entries

Adjusting entries are journal entries made at the end of an accounting period to update account balances before preparing financial statements, aligning them with the accrual basis of accounting.

Current Assets

Holdings that are projected to be liquidated, traded, or used up within twelve months or over the course of the operating cycle, depending on which timeframe is more extended.