In Confirming a Client's Accounts Receivable in Prior Years, an Auditor

question 777

Multiple Choice

In confirming a client's accounts receivable in prior years, an auditor found that there were many differences between the recorded account balances and the confirmation replies. These differences, which were not misstatements, required substantial time to resolve. In defining the sampling unit for the current year's audit, the auditor most likely would choose:

• A) Individual overdue balances.
• B) Individual invoices.
• C) Small account balances.
• D) Large account balances.

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Definitions:

EMDR

A therapeutic approach known as Eye Movement Desensitization and Reprocessing aimed at lessening the discomfort linked to traumatic recollections.

Posttraumatic Stress Disorder

A mental condition triggered by witnessing or experiencing a terrifying event, leading to lasting stress and anxiety.

Effective

The capability of producing a desired result or achieving a specific outcome successfully.

Placebo Effect

The phenomenon in which patients improve because they believe they are receiving treatment, even though they are actually receiving a sham or inert treatment.