Substantive Analytical Procedures Performed During the Testing Phase of the Audit

question 23

Multiple Choice

Substantive analytical procedures performed during the testing phase of the audit

• A) are required under generally accepted auditing standards.
• B) are always done independently from other audit procedures.
• C) are used as a substantive test in support of account balances.
• D) do not need to be documented in the working papers.

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Definitions:

Cash Provided

Funds that are generated and made available by a business through its operational activities, investments, or financing.

Investing Transactions

Financial activities related to the purchase or sale of long-term assets and investment securities.

Loss on Sale

The financial loss incurred when an asset is sold for less than its carrying amount on the balance sheet.

Indirect Method

A technique used in cash flow statement preparation that adjusts net income for the effects of non-cash transactions and changes in working capital.