The Auditor Uses a Variety of Procedures to Test Whether

question 74

Multiple Choice

The auditor uses a variety of procedures to test whether controls effectively.These procedures may all of the following except:

• A)Take a sample of purchase orders and trace them through the system to determine whether (a)there was proper review of credit,and (b)credit authorization or denial was proper.
• B)Take a sample of recorded items (accounts payable)and send a positive confirmation to the related vendors to determine whether the balance is properly stated.
• C)Take a sample of recorded items (accounts receivable)and trace back to the credit approval process to determine that it was performed appropriately.
• D)Use a computer audit program to read all accounts receivable and develop a print- out of all account balances that exceed their credit authorization.

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Definitions:

Business Entrepreneurs

Individuals who initiate, manage, and assume the risks of a business venture in pursuit of profit.

Planters

Large-scale farmers who owned significant amounts of land and typically utilized slave labor before the Civil War in the United States.

Public Schools

Educational institutions that are primarily funded and managed by local, state, or national governments, and free of charge for the children of a community.

Redeemers Power

Refers to the political power exerted by the Redeemers, a coalition of pro-business, white Democrats who sought to reclaim control from Republican reconstruction governments in the South after the Civil War.