Performing Substantive Procedures Prior to Year-End, in the Absence of Specific

question 33

Multiple Choice

Performing substantive procedures prior to year-end, in the absence of specific effective controls, may be acceptable when:

• A) the auditor is able to conclude overall that the client's control environment is effective.
• B) the likelihood of errors or fraud is high.
• C) the likelihood of errors or fraud is low.
• D) both a and c

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Definitions:

Comparative Purposes

For comparative purposes entails analyzing financial statements or other data side by side to discern trends, effects of strategies, or performance over time.

Depreciation Expense

A charge that reflects the cost of using fixed assets over their useful life.

Plant Assets

Durable assets with physical form, employed in running a company and not meant for resale.

Year Ended

The conclusion of a 12-month accounting period, at which financial statements are prepared.