When Auditing Prepaid Insurance

question 72

Multiple Choice

When auditing prepaid insurance,

• A) for many audits, significant substantive procedures are needed if the control risk is low.
• B) companies often have a standard monthly journal entry to reclassify prepaid insurance as insurance expense.
• C) the emphasis in the tests of details of balances is on insurance expense.
• D) the auditor must prepare the insurance register.