In Evaluating the Reasonableness of an Accounting Estimate, an Auditor

question 85

Multiple Choice

In evaluating the reasonableness of an accounting estimate, an auditor would be least likely to use which of the following approaches?

• A) Review subsequent events or transactions occurring prior to audit completion.
• B) Develop an independent expectation of the estimate.
• C) Review and test the process used to develop the estimate.
• D) Review the minutes of board of directors and shareholder meetings for discussion of the estimate.

---

Definitions:

Ballottement

A medical test where a part of the body is bounced between two hands to detect fluid accumulation or joint integrity.

Patella

Also known as the kneecap, it is a small bone located in front of the knee joint, providing protection and leverage for leg muscles.

Fluid

Any substance that can flow and take the shape of the container that holds it, including liquids, gases, and plasmas.

Musculoskeletal Assessment

A comprehensive evaluation of the musculoskeletal system to identify injuries, diseases, or abnormalities affecting muscles, bones, and joints.