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Preliminary Analytical Procedures for an Audit Client Focusing on Liquidity

question 153

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Preliminary analytical procedures for an audit client focusing on liquidity activity ratios find that the client's accounts receivable turnover ratio is significantly better than in previous years. The ratio is also significantly better compared to similar firms in the same industry. The results of this ratio indicate, preliminarily, that the accounts receivable area has been identified as having increased risk to the auditor.


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An individual applying for and being considered for employment in a specific job role.

Job Performance Tests

Assessments designed to evaluate an employee's effectiveness, efficiency, and productivity in their role.

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The extent to which a concept, conclusion, or measurement is well-founded and likely corresponds accurately to the real world.

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Tailoring products or services to meet the specific needs or preferences of individual customers.

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