Confirmation of Accounts Receivable Is Presumptively Mandatory Audit Procedure

question 41

Essay

Confirmation of accounts receivable is presumptively mandatory audit procedure.In performing this procedure,auditors use positive confirmation requests or negative confirmation requests or a combination of both.
a.Describe three conditions which should exist for the auditors to use the negative form of request.
b.If a response is not received to an initial positive confirmation request,describe the action that should be taken by the auditors,including a discussion of alternative auditing procedures.

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Definitions:

External Agencies

Organizations or firms outside of a company that are utilized to perform tasks or services that are not handled in-house, often including advertising, marketing, or public relations efforts.

Formal Invitation

An official or ceremonial request for someone's presence at an event, typically conveyed through a written or printed card.

Informational Report

A factual document aimed at informing the reader about a specific topic, without persuasion.

Topical Category

A classification or grouping based on subject matter or theme.