How Does the Auditor Gather Evidence Using the Confirmation Process

question 23

Multiple Choice

How does the auditor gather evidence using the confirmation process?

• A)The auditor selects a sample of customer balances from the year-end accounts receivable subsidiary ledger
• B)Each of the customers selected for confirmation will be sent a letter asking him to confirm the balance that he is owed by the audit client at year-end
• C)Management can choose to send either positive or negative confirmations
• D)Positive confirmations request the customer to return the confirmation directly to management if the balance is correct or incorrect
• E)Negative confirmations request the customer to return the confirmation directly to the auditor only if the balance is incorrect
• F)Both A and E
• G)Both B and D
• H)Both C and E

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Definitions:

Introversion

A personality trait characterized by a preference for solitary activities and environments that are not overly stimulating; introverts recharge by spending time alone.

Narcissism

Excessive self-love and self-absorption.

Salivate

The secretion of saliva in the mouth, which can be an automatic response to the anticipation of food.

Lemon Juice

The liquid extract of the lemon fruit, known for its acidic taste and high vitamin C content.