Auditing And Assurance Services
17th Edition
ISBN: 9780134897431
Author: ARENS, Alvin A.
Publisher: PEARSON
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Question
Chapter 7, Problem 23.1MCQ
To determine
Identify the following types of documentary evidence that the auditor should consider to be the most reliable.
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Which of the following types of documentary evidence should the auditor consider to be the most reliable?
Select one:
a. A sales invoice issued by the client and supported by a delivery receipt from an outside trucker.
b. Confirmation of an account payable balance mailed by and returned directly to the auditor
c. An audit schedule prepared by the client’s controller and reviewed by the client’s treasurer.
d. A check, issued by the company and bearing the payee’s endorsement, that is included with the bank statements mailed directly to the auditor
Which of the following types of documentary evidence should the auditor consider the most reliable?a. Sales invoice created by the client with the support of proof of delivery from an outside delivery serviceb. Confirmation of debt balances sent and returned directly to the auditorc. Check made by the company and includes a sign of approval of the party receiving the money, which is included in the bank statement sent directly to the auditord. An audit list prepared by the client controller and reviewed by the client treasurer.
Which of the following types of audit evidence is the least persuasive?
a. Bank statements obtained from the client.
O b.
O c. Prenumbered purchase order forms.
O d. Correspondence from the client's attorney about litigation.
Test counts of inventory performed by the auditor.
Chapter 7 Solutions
Auditing And Assurance Services
Ch. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - Prob. 8RQCh. 7 - Prob. 9RQCh. 7 - Prob. 10RQ
Ch. 7 - Prob. 11RQCh. 7 - Prob. 12RQCh. 7 - Prob. 13RQCh. 7 - Prob. 14RQCh. 7 - Prob. 15RQCh. 7 - Prob. 16RQCh. 7 - Prob. 17RQCh. 7 - Prob. 18RQCh. 7 - Prob. 19RQCh. 7 - Prob. 20RQCh. 7 - Define what is meant by a tick mark. What is its...Ch. 7 - Prob. 22RQCh. 7 - Prob. 23.1MCQCh. 7 - Prob. 23.2MCQCh. 7 - Prob. 23.3MCQCh. 7 - Prob. 24.1MCQCh. 7 - Prob. 24.2MCQCh. 7 - Prob. 24.3MCQCh. 7 - Prob. 25.1MCQCh. 7 - Prob. 25.2MCQCh. 7 - Prob. 25.3MCQCh. 7 - Prob. 26.1MCQCh. 7 - Prob. 26.2MCQCh. 7 - Prob. 26.3MCQCh. 7 - Prob. 27DQPCh. 7 - Prob. 28DQPCh. 7 - Prob. 29DQPCh. 7 - Prob. 30DQPCh. 7 - Prob. 31DQPCh. 7 - Prob. 32DQPCh. 7 - Prob. 33DQPCh. 7 - Prob. 34DQPCh. 7 - Prob. 36DQPCh. 7 - Prob. 37DQPCh. 7 - Prob. 40DQP
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Similar questions
- Audit evidence can come in different forms with different degrees of persuasiveness.Which of the following is the least persuasive type of evidence?(1) Vendor’s invoice(2) Bank statement obtained from the client(3) Computations made by the auditor(4) Prenumbered sales invoicesarrow_forwardthe auditor is planning to use accounts payable confirmations when auditing the client's accounts payable. The use of accounts payable confirmations will test which of the following assertions? a. rights and obligations b. existence (only) c. existence and completeness d. cutoffarrow_forwardWhich of the following procedures would provide the most reliable audit evidence?a. Inquiries of the client’s internal audit staff.b. Inspection of prenumbered client purchase orders filed in the vouchers payable department.c. Inspection of vendor sales invoices received from client personnel.d. Inspection of bank statements obtained directly from the client’s financial institution.arrow_forward
- Audit evidence can come in different forms with different degrees of reliability. Which of the following types of evidence is the least reliable?a. Invoices from suppliersb. Bank statements obtained from clientsc. The calculations made by the auditord. Sales invoice unnumberedarrow_forwardWhich of the following types of audit evidence provides the least assurance of reliability? A. Receivable confirmations received from the client's customers B. prenumbered receiving reports completed by the client's employees C. Prior months' bank statements obtained from the client D. Municipal property tax bills prepared in the client's name.arrow_forwardChoose the one correct answer In auditing the client’s receivables, the auditor decided to select entries in the sales journal and trace them back to the sales invoice, delivery receipt and the sales order. This procedure is consistent in corroborating which of the following assertion? * A. ValuationB. ExistenceC. CompletenessD. Rights and Obligationse. None of the abovearrow_forward
- The following questions concern types of audit tests.Choose the best response.a. The auditor looks for an indication on duplicate sales invoices to see whether theaccuracy of invoices has been verified. This is an example of(1) a test of details of balances. (3) a substantive test of transactions.(2) a test of control. (4) both a test of control and a substantivetest of transactions.arrow_forwardThe main object of an audit is a. Expression of expert opinion b. Detection and Prevention of fraud and error c. Examination of books of accounts d. Preparation of financial statementsarrow_forwardSelect from the following the main object of an audit. a. Expression of expert opinion b. Detection and Prevention of fraud and error c. Preparation of financial statements d. Examination of books of accountsarrow_forward
- Which of the following audit procedures is a dual-purpose test, which tests the effectiveness of internal controls as well as any material misstatements in the financial statements? A. The auditor accounts for the sequence of sales invoices. B. The auditor selects a sample of transactions in the sales journal and traces them to the relevant shipping documents. C. The auditor adds the transactions in the purchase journal and agrees to the total amount recorded in the general ledger. D. A test over the bank reconciliation. E. The auditor obtains a sample of timesheets for casual employees and checks for evidence of approval.arrow_forward1. Which of the following may be considered to be primary objective of the auditor in the examination of accounts receivables? a. Determine the approximate time of collectability of receivables b. Determine the relationship of receivables to sales c. Determine the reasonableness of the sales figure d. Establish validity and collectability of receivables 2. In determining the validity of accounts receivable, which of the following would the auditor consider most reliable? a. Direct telephone communication between the auditor and debtor b. Confirmation replies received directly from customers c. Credits to accounts receivable from the cash receipts book after the close of business at year end d. Documentary evidence that supports the accounts receivable balance 3. An auditor should perform alternative procedures to substantiate the existence of accounts receivable when a. Pledging of the receivables is probable b. No reply to a negative confirmation request is received c. No reply to a…arrow_forwardAnalytical procedures are generally used to produce evidence froma. Confirmations mailed directly to the auditors by client customers.b. Physical observation of inventories.c. Relationships among current financial balances and prior balances, forecasts, and nonfinancial data.d. Detailed examination of external, external-internal, and internal documents.arrow_forward
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