The Primary Objective of Analytical Procedures Used near the End

question 40

Multiple Choice

The primary objective of analytical procedures used near the end of an audit is to

• A)Obtain evidence from details tested to corroborate management assertions.
• B)Obtain evidence on the validity of the assessment of control risk.
• C)Assist auditors in evaluating the overall financial statement presentation.
• D)Identify areas that represent specific risks relevant to the audit.

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Definitions:

Maturity Value

The amount of money an investment will produce at the end of its holding period, including the principal and interest or dividends.

Price Volatility

The degree to which the price of an asset, security, or market index moves up or down over time.

Coupon Bond

A bond that pays the holder a fixed interest payment (coupon) at regular intervals until maturity, when the principal amount is repaid.

Maturity

The date on which the principal amount of a financial instrument, such as a bond or loan, becomes due and is to be paid.