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When the Auditor Plans to Use Analytical Procedures to Provide

question 38

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When the auditor plans to use analytical procedures to provide substantive assurance about an account balance, the data used in the calculations must be considered:


Definitions:

Actual Values

The real, measured values obtained from data collection as opposed to predicted or estimated figures.

Unusual Events

Occurrences that deviate significantly from the norm, which can impact operations, finances, or safety in various contexts.

Mean Absolute Deviation

A measure of variability that shows the average distance between each data point and the mean of the data set.

Correlation Coefficient

A statistical measure that calculates the strength and direction of a linear relationship between two quantitative variables.

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