Which of the Following Might Be Detected by Auditors' Cutoff

question 19

Multiple Choice

Which of the following might be detected by auditors' cutoff review and examination of sales journal entries for several days prior to the balance sheet date?

• A)Lapping year-end accounts receivable.
• B)Inflating sales for the year.
• C)Kiting bank balances.
• D)Misappropriating merchandise.

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Definitions:

Physical Controls

Security measures used to safeguard tangible assets from loss or theft, such as locks, alarms, and surveillance.

Independent Internal Verification

A process within companies where transactions and operations are reviewed by internal staff members who are not directly involved in the execution of these transactions, to ensure accuracy and compliance.

Human Resource Controls

Human Resource controls are mechanisms put in place to manage employees' performance and ensure compliance with organizational policies.

Segregation Of Duties

A fundamental internal control principle that divides responsibilities within an organization to reduce risks of errors or fraud.