Why Will an Auditor More Extensively Test Controls for the Completeness

question 47

Multiple Choice

Why will an auditor more extensively test controls for the completeness assertion on liability accounts than on asset accounts?

• A) The risk of unrecorded liabilities is greater than the risk of unrecorded assets.
• B) The completeness assertion is not applicable to asset accounts.
• C) The liabilities account balances presented in the financial statements tend to be more complete than the asset accounts.
• D) The most likely type of misstatement for liabilities is overstatements.

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Definitions:

Phone Tone

The sound or quality of a person's voice as perceived over the telephone, which can convey emotions or attitudes.

Disbelief

A mental state in which a person refuses to accept or is unable to believe in something as true.

Answering Machine

A device connected to a telephone to record messages when no one is available to answer the phone.

Office Closed

Indicates that a business or professional office is not open for operations or public access.