To Establish the Existence and Ownership of a Long-Term Investment

question 531

Multiple Choice

To establish the existence and ownership of a long-term investment in the common stock of a publiclytraded company, an auditor ordinarily performs a security count or:

• A) Relies on the client's internal accounting controls if the auditor has reasonable assurance that the control activities are being applied as prescribed.
• B) Confirms the number of shares owned that are held by an independent custodian.
• C) Determines the market price per share at the balance sheet date from published quotations.
• D) Confirms the number of shares owned with the issuing company.

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Definitions:

Barriers to Effective Communication

Factors that impede the transfer or understanding of information among parties.

Constructive Confrontation

is a method of addressing conflicts in a positive way, aiming to find solutions through open dialogue and mutual respect.

Communication Barrier

Any obstacle that impedes the exchange of information between individuals or groups.

Ambushing

A communication strategy where a listener gathers information to use against the speaker, often seen in debates or arguments.