Which of the Following Procedures Should an Auditor Generally Perform

question 59

Multiple Choice

Which of the following procedures should an auditor generally perform regarding subsequent events?

• A)Compare the latest available interim financial statements issued after year-end with the financial statements being audited.
• B)Send second requests to the entity's customers who failed to respond to initial accounts receivable confirmation requests.
• C)Communicate material weaknesses in internal controls to those charged with governance.
• D)Review the cutoff bank statements for several months after year-end.

---

Definitions:

Producing Sales

The process of generating revenue through the selling of goods or services.

Vertical Analysis

A method of financial statement analysis in which each line item is listed as a percentage of a base figure from the statement.

Ratio Analysis

An examination of the relationship between two numbers or sets of numbers on financial reports. Analyses of ratios, especially over time, can give a fairly clear picture of how well a company conducts its business.