Which of the Following Forms of Evidence Would Be Least

question 65

Multiple Choice

Which of the following forms of evidence would be least persuasive in forming the auditor's opinion about marketable securities and other investments held by the company?

• A)Responses to auditor's questions by the president and controller regarding the investments account
• B)Correspondence with a stockbroker regarding the quantity of client's investments held in street name by the broker
• C)Minutes of the board of directors authorizing the purchase of stock as an investment
• D)The auditor's count of marketable securities

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Definitions:

Security Interest

A legal claim or lien on collateral that has been pledged, usually to secure repayment of a debt or performance of some other obligation.

Priority

The status of being regarded or treated as more important than other matters.

Purchase Money Security Interest

A security interest that is (1) taken or retained by the seller of collateral to secure all or part of its purchase price or (2) taken by a debtor to acquire rights in or the use of the collateral if the value is so used.

Inventory Collateral

Assets from a company's inventory that are pledged to secure a loan.