When Accounts Receivable Are Confirmed at an Interim Date, Auditors

question 75

Multiple Choice

When accounts receivable are confirmed at an interim date, auditors need not be concerned with:

• A)obtaining a summary of receivables transactions from the interim date to the year-end date.
• B)obtaining a year-end trial balance of receivables, comparing it to the interim trial balance, and obtaining evidence and explanations for large variations.
• C)sending negative confirmations to all the customers as of the year-end date.
• D)considering the necessity for some additional confirmations as of the balance sheet date if balances have increased materially.

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Definitions:

Alliance

A formal agreement or partnership between individuals, organizations, or countries to achieve mutual goals.

Organizational Entity

Refers to any specific social unit in the context of a larger social system, including businesses, governments, and non-profits, that has a structured purpose and function.

Vertical Integration

A strategy where a company expands its operations into different stages of production or distribution within the same industry.

Increase Risk

Enhancing the likelihood of encountering negative outcomes or danger in a given situation.