Distinguish between lapping and kiting


Response to the following questions:

1. Explain the purpose of a four-column proof of cash. List two types of misstatements it is meant to uncover.

2. Distinguish between lapping and kiting. Describe audit procedures that can be used to uncover each.

3. How would an auditor test the realizable value audit objective for a financial instrument classified as a level 3 fair value estimate?

 

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Auditing: Distinguish between lapping and kiting
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