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What are the goals of dual-direction testing regarding an audit of the accounts receivable andcash collection system?

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

Chapter9: Auditing The Revenue Cycle.

Section: Chapter Questions

Problem 2RQSC

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cash collection system?

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When auditing accounts receivables, auditors are usually especially concerned about the: a. Completeness and cut-off objectives. b. Existence and completeness objectives. c. Existence, realisable-value and accuracy objectives. d. Posting and summarisation objective.
What tools do auditors use to verify the ending balances in the various accounts in the acquisition and payments cycle? Please provide reference(s).
To gather audit evidence related to accounts receivable, the client should mail the confirmation requests. TRUE OR FALSE? WHY?
The most probable audit processes to verify receivables written off as uncollectible include Explain the aim of each of these steps.
What are the risks associated with auditing accounts payable? Can you explain the process of auditing accounts payable using confirmations.
What audit procedures are most likely to be used to verify accountsreceivable written off as uncollectible? State the purpose of each of these procedures.
Explain the audit of receivables
List the transaction-related audit objectives for the verificationof cash receipts. For each objective, state one internal control that the client can use toreduce the likelihood of misstatements.
In the audit of accounts receivable, the most important emphasis should be on thea. Completeness assertion.b. Existence assertion.c. Rights and obligations assertion.d. Presentation and disclosure assertion
Discuss the meaning of the following terms and how they apply to auditing accounts receivable: a. tie-in b. completeness c. existence d. accuracy e. rights f. realizable value g. cutoff h. classification Please provide references.
When auditing the revenue and collection cycle, auditors normally select balances to confirm from thea. Sales journal.b. Accounts receivable listing.c. General ledger.d. Cash receipts listing
Distinguish among tests of details of balances, tests of controls,and substantive tests of transactions for the sales and collection cycle. Explain how thetests of controls and substantive tests of transactions affect the tests of details of balances.