The Auditor Obtains Corroborating Audit Evidence for Accounts Receivable by Using

question 13

Multiple Choice

The auditor obtains corroborating audit evidence for accounts receivable by using positive or negative confirmation requests.Under which of the following circumstances might the negative form of the accounts receivable confirmation be useful?

• A)A substantial number of accounts are in dispute.
• B)Internal control over accounts receivable is ineffective.
• C)Client records include a large number of relatively small balances.
• D)The auditor believes that recipients of the requests are unlikely to give them consideration.

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Definitions:

GDI

Gross Domestic Income, which measures a country's total income earned from its economic activities, including wages, profits, and taxes minus subsidies.

GDP

Gross Domestic Product, the total value of all goods and services produced within a country's borders in a specific time period.

Net Domestic Product

The total value of all goods and services produced within a country in a specific time period, minus the depreciation on its capital goods.

National Income

The total value of all goods and services produced by a country's economy over a specific period, often used as a measure of the economic health of a nation.