If, When Obtaining an Understanding of Control Activities of a Relatively

question 61

True/False

If, when obtaining an understanding of control activities of a relatively small client, the auditor identified no control activities, the auditor would probably reassess whether the client is auditable.

---

Definitions:

Sales Forecast

An estimate of the future sales of a product or service over a specific period, based on historical data, market analysis, and other factors.

Accounts Receivable

Money owed to a business by its customers for goods or services that have been delivered but not yet paid for.

Average Collection Period

The average number of days it takes for a company to collect payments from its credit sales, a measure of the effectiveness of its credit and collection policies.

Year-End Balance

The final amount of money in an account at the conclusion of a financial year, after all transactions have been accounted for.