Of the Following, Which Is an Important Procedure That an Auditor

question 15

Multiple Choice

Of the following, which is an important procedure that an auditor should use when making an overall review of the income statement?

• A)Obtain a schedule of the retained earnings activity for the period.
• B)Compare actual revenues and expenses with the corresponding figures of the previous year and investigate significant differences.
• C)Obtain, from the proper entity representative, inventory certificates for the beginning and ending inventory amounts that were used to determine cost of sales.
• D)Ascertain that the net income amount in the statement of cash flows agrees with the net income amount in the income statement.

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Definitions:

Actual Threats

Genuine risks or dangers that are present and could cause harm.

"Old-Fashioned" Discrimination

Discrimination practices or attitudes that are rooted in historical or traditional biases and inequalities, often based on race, gender, or social class.

Modern Discrimination

Refers to current forms and practices of unfair treatment or prejudice against individuals or groups based on race, gender, age, or other characteristics, often subtle and institutionalized.

Defensive Discrimination

Practices or attitudes that emerge as a defensive mechanism, often based on prejudice or bias, intended to protect a group from perceived threats.