When Auditing Prepaid Insurance, an Auditor Discovers That the Original

question 199

Multiple Choice

When auditing prepaid insurance, an auditor discovers that the original insurance policy on plant equipment is not available for inspection. The policy's absence most likely indicates the possibility of a (an) :

• A) Insurance premium due but not recorded.
• B) Deficiency in the coinsurance provision.
• C) Lien on the plant equipment.
• D) Understatement of insurance expense.

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Definitions:

Acknowledgement Skills

The capacity to recognize and validate the feelings, thoughts, or contributions of others.

Good Leadership

Leadership characterized by strong ethical standards, empathy, motivation, and the ability to foster teamwork and innovation.

Self-Managed Teams

Groups of employees who are given the autonomy to plan, execute, and manage their own work and tasks without traditional managerial supervision.

Clearly Defined Product

A product or service with explicit specifications, features, and benefits, making its purpose and use straightforward to consumers.