Response to the following questions:
1. State three types of differences that might be observed in the confirmation of accounts receivable that do not constitute misstatements. For each, state an audit procedure that will verify the difference.
2. What is the relationship of each of the following to the sales and collection cycle: flowcharts, assessing control risk, tests of controls, and tests of details of balances?
3. Why does an auditor review sales returns subsequent to year-end? What audit objective does this procedure satisfy?