An Auditor Most Likely Would Extend Substantive Tests of Payroll

question 45

Multiple Choice

An auditor most likely would extend substantive tests of payroll when:

• A)payroll is extensively audited by the state government.
• B)payroll expense is substantially higher than in the prior year due to company growth.
• C)overpayments are discovered in performing tests of details.
• D)employees complain to management about too much overtime.

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Definitions:

Interest Rate

The percentage charged on the total amount borrowed or paid on deposited funds over a specific time period.

Liquid Assets

Assets that can quickly and easily be converted into cash without significant loss in value.

Interest Rate

The percentage of a loan that is applied as interest for the borrower, usually expressed as an annual rate of the remaining loan balance.

Money Supplied

A rephrased definition: The total volume of money provided or injected into the economy by various sources, including but not limited to monetary authorities.