Payroll Expenses: Overpayment of overtime. Account Payable: Payments made twice to the same supplier. Fixed Assets: wrong calculation to the depreciation. Required: Determine the key assertion at risk Describe a practical preventive internal control that would directly address the risk Describe a practical detective internal control that could implement in relation to the risk Describe a practical test that could use to have evidence support the assertion

Payroll Expenses: Overpayment of overtime. Account Payable: Payments made twice to the same supplier. Fixed Assets: wrong calculation to the depreciation. Required: Determine the key assertion at risk Describe a practical preventive internal control that would directly address the risk Describe a practical detective internal control that could implement in relation to the risk Describe a practical test that could use to have evidence support the assertion

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter11: Auditing Inventory, Goods And Services, And Accounts Payable: The Acquisition And Payment Cycle

Section: Chapter Questions

Problem 7CYBK

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the heightened risk of material misstatement. 6. Which of the. following techniques overstate long-lived assets? a. Overvalue existing assets. b. Include fictitious assets on the financial statements. c. Capitalize transactions that should be expensed. d. All of the above. can be used by management to 7. Which of the following analyses might an auditor perform as part of preliminary analytical procedures? a. Develop an overall estimate of depreciation expense. b. Compare capital expenditùres with the client's capital budget. c. Perform a trend analysis of the ratio of depreciation expense to total depreciable long-lived tangible assets. d. All of the above could be performed as part of preliminary analytical procedures. 8. Assume that the auditor decides to only, perform substantive tests of details when auditing the equipment account. Which of the following statements best describes the circumstancės associated with the client being audited? The client does not have effective controls…
tch the type of risk with the related definition.A. Detection riskB. Control riskC. Inherent riskD. Audit risk___ 1. The probability that an auditor will give an inappropriate opinion on financial statements.___ 2. The probability that audit procedures will fail to produce evidence of material misstatements.___ 3. The probability that the client's internal control policies and procedures will fail to detect material misstatements if they have entered the accounting system.___ 4. The probability that material misstatements have occurred in transactions entering the accounting system.
Some account balances such as those for pensions and leases are the result of complex calculations. The susceptibility to material misstatements in these types of accounts is defined as a. Sampling risk b. Detection risk c. Inherent risk. d. audit risk
1. Please explain Audit of Long-term Liabilities 2. Please explain ISA540 and AU-C540. 3. What are the indicators of possible management bias of ISA540 and AU - C 540 standards. 4. Please explain whether the presence of an indicator of management bias means there is a material misstatement.
Which of the following best describes why auditors audit leased assets in conjunction with the audit of property, plant & equipment? Multiple Choice (B & D are incorrect) A. Most leased assets should be capitalized. B. Repairs and maintenance expense is affected by leased assets. C. Management may choose to lease assets rather than buy them. D. Leased assets have a higher risk of misstatement.
Which is not a Risk Assessment Procedure? a. Ratio Analysis b. Observation of Activities c. Account Receivable confirmations d. Inspection of Documents e. Inquiry of Internal Auditors
which of the following regarding errors is correct Select one: a. intentional misstatement of the financial statements, b. misappropriation of assets is an kind of errors c. a mistake in recording the date of a sale invoice is an example of the errors d. it is more difficult for the auditor to detect because it is not intentional
Fraudulent reporting by management could include a. Fictitious revenues from a fake customer. b. Improper asset valuation. c. Mismatching revenues and expenses. d. All of the above.
S1. Operational risk, as opposed to efficiency, is the risk of loss resulting from inadequate internal processes, people, and systems or from external events. S2. FS audit is concerned on to see that the credit control has been strictly followed while operational audit is concerned on to study the credit control system for suggesting better measures as necessary. Which of the following statements is/are false?
5. Which of the following statements is false regarding fraud risk factors related to long-lived assets, tangible and intangible? a. A potential fraud scheme involves not removing sold assets from the books. b. Because long-lived assets are typically an audit area of low risk, auditors do not need to perform brainstorming activities related to long-lived assets. c. Management might use unreasonably long depreciable lives in an effort to reduce expenses. d. None of the above statements is false.
the susceptibility of an account balance or class of transactions to misstatements that could be material, individually or when aggregated with misstatements in other balances or classes, assuming that there were no related internal control is called : Select one: a. control risk b. audit risk c. detection risk d. inherent risk
ZZZ best fraud case, auditors obtained third party confirmation to support the contract, reviewed available documentation, performed analytical procedures to evaluate the reasonable of revenue recorded on the contract and visited selected restoration sites. what are the limitations of the evidence that these audit procedures provide with regard to the management assertion of occurrence?