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Are all supporting documents properly cancelled at the time the checks are signed?
Distinguish between a positive and a negative confirmation and state the circumstances in which each should be used.
Under what circumstances would an auditor choose to confirm information such as the right of return or special sales terms in addition to the customer balance?
Explain why the analysis of differences is important in the confirmation of accounts receivable, even if the misstatements in the sample are not material.
Why does an auditor review sales returns subsequent to year-end? What audit objective does this procedure satisfy?
An auditor is determining the appropriate sample size for testing inventory valuation using MUS.
Why is it difficult to determine the appropriate sample size for MUS? How should the auditor determine the proper sample size?
Define what is meant by the population standard deviation and explain its importance in variables sampling.
In using difference estimation, an auditor took a random sample of 100 inventory items from a large population to test for proper pricing.
Distinguish among difference estimation, ratio estimation, mean-per-unit estimation, and stratified mean-per-unit estimation.
An essential step in difference estimation is the comparison of each computed confidence limit with tolerable misstatement.
Assume that instead of good results, poor results were obtained for tests of controls and substantive tests of transactions for sales, sales returns.
Calculate the misstatement bounds for the three combined accounts and reach appropriate audit conclusions.
Calculate the point estimate, the computed precision interval, the confidence interval, and the confidence limits for the population.
Plan the combined sample size for both the confirmation of accounts receivable and the price tests of inventory using MUS.
List one possible internal control for each of the six transaction related audit objectives for cash disbursements.
What is the importance of cash discounts to the client and how can the auditor verify whether they are being taken in accordance with company policy?
In selecting the acquisitions and cash disbursements sample for testing, the best approach is to select a random month and test every transaction for period.
Select a random sample of receiving reports and trace them to related vendors' invoices and acquisitions journal entries, comparing the vendor's name.
What is meant by a voucher? Explain how its use can improve an organization's internal controls.
Explain the relationship between tests of the acquisition and payment cycle and tests of inventory.
Assess the sections of SOX, indicating those sections that have the greatest impact on the external auditor.
The partner on the engagement has asked you to identify business risks that could adversely affect TCC's sustained profitability.
Indicate the number of days between each company's year-end and the date of the audit report. What factors may impact the number of days to issue the audit.
Prepare a performance audit program for acquisitions and cash disbursements using all audit procedures in requirements.