Which of the Following Statements Is Not True

question 95

Multiple Choice

Which of the following statements is not true?

• A) Analytical procedures emphasize the overall reasonableness of transactions and balances.
• B) Tests of controls are concerned with evaluating whether controls are sufficiently effective to justify reducing control risk and thereby reducing analytical review procedures.
• C) Substantive tests of transactions emphasize the verification of transactions recorded in the journals and then posted in the general ledger.
• D) Tests of details of balances emphasize the ending balances in the general ledger.

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Definitions:

Excess Reserves

Funds that banks hold over and above the required minimum reserves specified by central banking authorities, which can be loaned out or invested.

Reserve Requirements

The minimum amount of reserves that banks must hold against deposits, set by central banks to ensure liquidity and control the money supply.

Discount Rate

The discount rate is the interest rate charged to commercial banks and other financial institutions for loans received from the Federal Reserve's discount window.

Prime Rate

The interest rate that commercial banks charge their most credit-worthy customers, frequently used as a benchmark in lending rates.