In Auditing Accounts Receivable, the Negative Form of Confirmation Request

question 86

Multiple Choice

In auditing accounts receivable, the negative form of confirmation request most likely would be used when:

• A)recipients are likely to return positive confirmation requests without verifying the accuracy of the information.
• B)the combined assessed level of inherent and control risk relative to accounts receivable is low.
• C)a small number of accounts receivable are involved but a relatively large number of errors are expected.
• D)the auditor performs a dual purpose test that assesses control risk and obtains substantive evidence.

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Definitions:

Longstanding

Existing for a long time or having a history that extends far back.

Dissociative Amnesia

A psychological condition characterized by temporary memory loss that cannot be attributed to normal forgetfulness, often resulting from traumatic events.

Conversion Disorder

A mental health condition where an individual shows psychological stress in physical ways, presenting symptoms affecting voluntary motor or sensory functions.

World Trade Center

refers to a large complex of buildings in Lower Manhattan, New York, most famous for being the site of a terrorist attack on September 11, 2001.