Indicate Whether You Agree or Disagree with the Following Statements

question 48

Essay

Indicate whether you agree or disagree with the following statements and explain your reasoning.
a) Paula Padgett was performing substantive tests of trade receivables at Neu Lion. She indicated to her staff member, Leona Marshall: "At this client accounts receivable are material in amount. The two assertions that are the most important are the occurrence and accuracy assertions."
b) Emilio Boulrice, CPA was returning from an audit conference where he had entertained his many friends with his musical talents. As he sat in his aisle in the Air Canada flight back home to Montreal, he turned to his friend and said: "Although there is no specific requirement for us to confirm receivables anymore, existence of trade receivables is usually verified by sending confirmations to the client's customers."
c) Mike Gallagher was preparing his staff for the audit of inventory at a major client. He said to his staff: "The two key assertions for inventory are proper cutoff and accuracy."
d) Mona Lincolnshire was assessing the results of her staff's substantive testing procedures. She said: "When performing substantive procedures, the key objective is to determine whether there are material misstatements within the balance being investigated and to quantify the amount of any errors if they exist."

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Definitions:

Pure Strategies

In game theory, a pure strategy is an action chosen by a player where they select a specific move to follow in every possible situation within a game.

Dominant Strategy

A strategy in game theory that yields the best outcome for a player, regardless of what the other players do.

Payoff

The gain or loss that an investor or a player in a game receives as a result of a particular action or decision.

Nash Equilibrium

A concept in game theory where no player can benefit by changing their strategy if the strategies of the other players remain unchanged.