Which of the Following Is a Substantive Test That an Auditor

question 61

Multiple Choice

Which of the following is a substantive test that an auditor most likely would perform to verify the existence and valuation of recorded accounts payable?

• A)Investigating the open purchase order file to ascertain that prenumbered purchase orders are used and accounted for.
• B)Receiving the client's unopened mail for a reasonable period of time after year-end to search for unrecorded vendor's invoices.
• C)Vouching selected entries in the accounts payable subsidiary ledger to purchase orders and receiving reports.
• D)Confirming accounts payable balances with known vendors and suppliers who have zero balances at year-end.

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Definitions:

Performance Advantage

The superiority that an individual or organization holds over competitors in terms of operational efficiency, effectiveness, and overall performance.

Total Quality Management

A comprehensive and continuous effort by an organization to improve the quality of its products, services, and processes through ongoing feedback and development.

Continuous Improvement

Continuous Improvement is an ongoing effort to improve products, services, or processes through incremental and breakthrough improvements, often influenced by methodologies like Lean and Six Sigma.

Customer Needs

The wants and requirements that customers express to fulfill a certain function or solve a problem through the purchase or use of a product or service.