Related Entity Transactions Can Most Often Be Discovered by Auditors

question 42

Multiple Choice

Related entity transactions can most often be discovered by auditors while performing which of the following procedures?

• A)confirming transactions with related parties.
• B)examining unusual transactions and inquiry.
• C)reviewing random canceled checks for endorsement.
• D)evaluating reconciliations and related approvals.

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Definitions:

Experimental

Pertaining to a method of research in which variables are manipulated and the effects on other variables are observed; crucial in establishing causality in psychology and other sciences.

Syllogism

A form of logical reasoning where a conclusion is drawn from two given or assumed propositions (premises) with a common term.

Reasoning

The process of thinking about something in a logical way in order to form a conclusion or judgment.

Cognition

The cognitive activity of gaining knowledge and comprehension via thinking, experiencing, and sensory input.