Which of the Following Is One of the Better Auditing

question 37

Multiple Choice

Which of the following is one of the better auditing techniques that might be used by an auditor to detect kiting between intercompany banks?

• A)Review the composition of authenticated deposit slips.
• B)Review subsequent bank statements received directly from the banks.
• C)Prepare a schedule of bank transfers.
• D)Prepare year-end bank reconciliations.

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Definitions:

Balance Sheet

A financial statement that displays a company's financial position at a certain point in time, showing assets, liabilities, and shareholders' equity.

Time-Sales Finance

Financing arrangements that allow consumers to purchase goods or services over time, typically involving installment payments.

Installment Contract

A legal agreement requiring regular payments over time for the purchase of goods or services, typically used for expensive items.

Conditional Sales Contracts

Agreements where the sale is contingent upon certain conditions, often used in transactions involving goods or property.