The Auditor Performs Analytical Procedures to

question 46

Multiple Choice

The auditor performs analytical procedures to

• A)increase his understanding of the business
• B)identify expected changes between his expectations for the current year and the prior year
• C)identify areas where he believes the risk of material misstatement might not be present
• D)satisfy the requirement of the auditing standards to use analytical procedures during the testing stage

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Definitions:

Domestic Investment

Financial investments within a country's borders in the form of business expansions, new construction, and purchases of machinery and equipment.

National Saving

National saving is the total amount of savings generated within a country, typically calculated as the sum of private and public saving.

Net Capital Outflow

The contrast between the investments made by citizens in foreign assets and those made by non-citizens in the nation's assets.

Domestic Investment

The commitment of resources by a country to invest in capital within its own borders.