Productivity Statistics Are Provided Quarterly to a Company's Board of Directors

question 426

Multiple Choice

Productivity statistics are provided quarterly to a company's board of directors. An auditor checked the ratios and other statistics in the four most recent reports. The auditor used scratch paper and copies of the board reports to verify the accuracy of computations and compared the data used in the computations with supporting documents. The auditor wrote a note describing this work for the workpapers and then discarded the scratch paper and report copies. The auditor's note stated. "The ratios and other statistics in the quarterly board reports were checked for the last four quarters, and appropriate supporting documents were examined. All amounts appear to be appropriate." In this situation:

• A) Four quarters is not a large enough sample on which to base a conclusion.
• B) The auditor's workpapers are not sufficient to facilitate an efficient review of the auditor's work.
• C) The auditor should have included the scratch paper in the workpapers.
• D) The auditor should have considered whether the information in the board report was compiled efficiently.

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Definitions:

Base

A substance that is characterized by its ability to accept protons or donate electron pairs in chemical reactions.

Terminals

The end points of an electrical device or a cable where connections are made to enable the flow of electrical current.

Diode

A semiconductor device that allows current to flow in one direction only, used in electronics for rectification and signaling.

Relay

Any of a number of devices that receives a signal and then effects an action. In vehicle electrical circuits, relays are used to allow a small current circuit to control a large current circuit such as in a starter relay. Also known as a pilot.