Which of the Following Procedures Is Not a Fraud-Related Audit

question 66

Multiple Choice

Which of the following procedures is not a fraud-related audit procedure used to respond to identified fraud risk factors?

• A)Physically inspect tangible assets,including major additions,and agree serial numbers with invoices or other supporting documents.
• B)Use the work of a specialist for asset valuations,including impairments.
• C)Confirm the terms of significant additions of property or intangibles with other parties involved in the transaction.
• D)All of the above are fraud-related audit procedures.

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Definitions:

Luxury Auto Limits

The maximum amount of depreciation expenses that taxpayers can claim for luxury vehicles, as defined and imposed by the IRS.

Depreciation

The accounting method of allocating the cost of a tangible or physical asset over its useful life, reflecting the loss in value over time.

Business Use

The utilization of goods, services, or assets for the purpose of generating income or benefits in a business context.

Half-Year Convention

The Half-Year Convention is a method for calculating depreciation in which all assets acquired during a year are considered to have been acquired at the midpoint of the year.