Audit Evidence Has Two Primary Qualities for the Auditor; Relevance

question 78

Multiple Choice

Audit evidence has two primary qualities for the auditor; relevance and reliability.Given the choices below, which provides the auditor with the most reliable audit evidence?

• A)General ledger account balances
• B)Confirmation of accounts receivable balance received from a customer
• C)Internal memo explaining the issuance of a credit memo
• D)Copy of month-end adjusting entries

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Definitions:

Catgut

A type of cord traditionally made from the natural fibers found in the intestines of animals, commonly used for musical instrument strings and surgical sutures.

Optimal Amount

The best or most efficient level of output or consumption that maximizes desired outcomes or minimizes costs.

R&D

Research and Development, referring to activities in connection with corporate or governmental innovation.

Interest-rate Cost

The expense incurred from borrowing money, typically expressed as a percentage of the principal amount.