Why Does the Auditor Divide the Financial Statements into Segments

question 54

Multiple Choice

Why does the auditor divide the financial statements into segments around the financial statement cycles?

• A) Most auditors are trained to audit cycles as opposed to entire financial statements.
• B) The approach aids in the assignment of tasks to different members of the audit team.
• C) The cycle approach is required by auditing standards.
• D) The cycle approach allows the auditor to detect illegal acts.

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Definitions:

Revenues

The total amount of income generated by the sale of goods or services related to a company's primary operations.