When Positive Confirmations Are Used, Auditing Standards Require Alternative Procedures

question 125

Multiple Choice

When positive confirmations are used, auditing standards require alternative procedures for confirmations not returned by the customer. Which of the following would not be considered an alternative procedure?

• A) Send a second confirmation request.
• B) Examine subsequent cash receipts to determine if the receivable has been paid.
• C) Examine shipping documents to verify that the merchandise was shipped.
• D) Examine sales invoice to verify the actual issuance of a sales invoice and the actual date of the billing.

Understand the goal alignment and misalignment in marketing channels.

Comprehend the principles of cooperative and competitive relationships within the supply chain.

Understand the basic concepts and terminology related to supply chain and inventory management, such as advanced shipping notices, just-in-time (JIT) systems, quick response (QR) inventory systems, and radio frequency identification (RFID) tags.

Comprehend the various types of inventory systems and their advantages in improving product availability and reducing inventory costs.

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Definitions:

Repurchase Agreements

Short-term borrowing for dealers in government securities, where the dealer sells the securities to investors usually overnight and buys them back the following day at a slightly higher price.

Government Securities

Debt instruments issued by a government to finance its operations and projects, typically considered safe investments.

Short-Term Borrowing

The act of obtaining funds for a relatively short period, usually less than one year, often used to address immediate financial needs or liquidity issues.

Index

A statistical measure of change in a representative group of individual data points, often used in finance to track the performance of markets or sectors.