Which of the Following Is a Substantive Procedure in the Audit

question 3

Multiple Choice

Which of the following is a substantive procedure in the audit of estimates made by auditor?

• A)Observing whether estimates are prepared by qualified personnel.
• B)Recalculating the mathematical estimate.
• C)Scanning for evidence of review by senior management.
• D)Ensuring estimates are recorded in the right accounts.

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Definitions:

Control Limits

Statistical boundaries within a control chart that signal the range of variability expected in a process's stable and controlled state.

Proportion

is a mathematical concept that denotes a part, share, or number considered in comparative relation to a whole.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values in a data set deviate from the mean.

Control Limits

Control limits are the boundaries set in statistical process control that indicate the acceptable range of variation for a process, distinguishing between common and special causes of variation.