In the Audit of Financial Statements,which of the Following Procedures

question 30

Multiple Choice

In the audit of financial statements,which of the following procedures would the auditor call an "extended procedure?"

• A)Measure the time lag between the date that cash receipts are recorded in the accounting records and the date that the deposit is credited to the bank account.
• B)Observe the client's physical inventory count and take test counts of stock in the warehouse.
• C)Send positive confirmations on accounts receivable balances.
• D)Interview the staff in the accounting department and document the controls over the recording of sales transactions.

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Definitions:

Control Theories

Theories in criminology and sociology that explain social order and the lack of criminal behavior as a result of societal norms and relationships that encourage conformity.

Deviance

Behavior or actions that violate societal norms or expectations, often leading to social disapproval or sanctions.

Crime

Crime is an act or omission that violates the law and is punishable by the state or other authority.

Compelling Explanation

A persuasive and cogent reason or argument that effectively explains a phenomenon, idea, or event.