Which of the Following Should Be Included in the Scope

question 319

Multiple Choice

Which of the following should be included in the scope of an audit of a third-party contractor? 1. Budgets and financial forecasts for the project. 2. Contractor's information and control systems. 3. Contractor's financial position. 4. Progress of the project and costs incurred.

• A) 1 and 4 only
• B) 1, 2, and 3 only
• C) 2, 3, and 4 only
• D) 1, 2, 3, and 4

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Definitions:

Interest Expense

The total charges faced by a business for financing through borrowed money over a duration.

Interest Payable

The amount of interest expense that has been incurred but not yet paid by a company during a given period.

Current Liabilities

Short-term financial obligations that are due to be paid within one year, including accounts payable, short-term loans, and taxes payable.

Long-term Debt

Loans or other forms of credit that are due for repayment in more than one year's time.