Which of the Following Audit Procedures Would Be Least Likely

question 16

Multiple Choice

Which of the following audit procedures would be least likely to disclose the existence of related party transactions of a client during the period under audit?

• A)Reading "conflict-of-interest" statements obtained by the client from its management.
• B)Scanning accounting records for large transactions at or just prior to the end of the period under audit.
• C)Reading minutes of the Board of Directors meetings for authorization or discussion of material transactions.
• D)Confirming purchases and sales transactions with the vendors and/or customers involved.

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Definitions:

Time-Series Graph

A time-series graph displays data points at successive time intervals, showing trends, cycles, or patterns over time.

Omitted Variables

Variables that are not included in a model, which can lead to biased estimates and incorrect conclusions.

Reverse Causality

A situation in research or analysis where it is unclear whether a supposedly causal factor is actually causing the outcome, or if the situation is happening because of the outcome itself; a reversal of the direction of causation.

Features of Construction

Characteristics or attributes that define the nature of construction projects, including complexity, permanence, and the need for collaboration among different specialties.