Principles Of Auditing & Other Assurance Services
21st Edition
ISBN: 9781259916984
Author: WHITTINGTON, Ray, Pany, Kurt
Publisher: Mcgraw-hill Education,
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Question
Chapter 5, Problem 45IOQ
To determine
Identify the appropriate answer regarding the section of the audit working papers that would represent the long-term lease agreement.
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Before applying substantive procedures to the details of asset and liability accounts at an interim date, the auditor should: Mutiple Choice consider the sblity of the suditor to perform aporopriate substartive procedures to cover the remaining period. investigete significant uctiations thet have occured in the asset and lability accounts since the previous balance sheet date. select only those accounts wich can eflectively be samplied during year end audit work consider the compliance tests that mut be applied at the balance sheet date to extend the audit conclusions reached at the interim date.
Audit documentation that shows the detailed evidence and procedures regarding the balancein the accumulated depreciation account for the year under audit will be found in thea. Current file audit documentation.b. Permanent file audit documentation.c. Administrative audit documentation in the current file.d. Planning memorandum in the current file.
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Chapter 5 Solutions
Principles Of Auditing & Other Assurance Services
Ch. 5 - Prob. 1RQCh. 5 - Prob. 2RQCh. 5 - Prob. 3RQCh. 5 - Distinguish among routine, nonroutine, and...Ch. 5 - Prob. 5RQCh. 5 - Prob. 6RQCh. 5 - Prob. 7RQCh. 5 - As part of the verification of accounts receivable...Ch. 5 - Prob. 9RQCh. 5 - When in the course of an audit might the auditors...
Ch. 5 - Prob. 11RQCh. 5 - Prob. 12RQCh. 5 - Prob. 13RQCh. 5 - Prob. 14RQCh. 5 - Prob. 15RQCh. 5 - Prob. 16RQCh. 5 - Prob. 17RQCh. 5 - Prob. 18RQCh. 5 - Prob. 19RQCh. 5 - What disclosures should be made in the financial...Ch. 5 - Prob. 21RQCh. 5 - Prob. 22RQCh. 5 - Prob. 23RQCh. 5 - Prob. 24RQCh. 5 - Prob. 25RQCh. 5 - Prob. 26RQCh. 5 - Prob. 27RQCh. 5 - Prob. 28RQCh. 5 - Prob. 29RQCh. 5 - Prob. 30RQCh. 5 - Prob. 31RQCh. 5 - I have finished my testing of footings of the cash...Ch. 5 - Prob. 33RQCh. 5 - Prob. 34RQCh. 5 - Financial statements contain a number of...Ch. 5 - Prob. 36QRACh. 5 - In an audit of financial statements, the auditors...Ch. 5 - Prob. 38QRACh. 5 - Prob. 39QRACh. 5 - Prob. 40QRACh. 5 - Prob. 41QRACh. 5 - Prob. 42QRACh. 5 - Prob. 43QRACh. 5 - Prob. 44QRACh. 5 - Prob. 45AOQCh. 5 - Prob. 45BOQCh. 5 - Prob. 45COQCh. 5 - Prob. 45DOQCh. 5 - Prob. 45EOQCh. 5 - Prob. 45FOQCh. 5 - Prob. 45GOQCh. 5 - Prob. 45HOQCh. 5 - Prob. 45IOQCh. 5 - Prob. 45JOQCh. 5 - Prob. 45KOQCh. 5 - A difference of opinion concerning accounting and...Ch. 5 - Prob. 46OQCh. 5 - Prob. 47OQCh. 5 - Prob. 48AOQCh. 5 - Prob. 48BOQCh. 5 - Prob. 48COQCh. 5 - The cost of analytical procedures in terms of time...Ch. 5 - Prob. 48EOQCh. 5 - Prob. 49OQCh. 5 - Prob. 50PCh. 5 - Prob. 51PCh. 5 - Prob. 52PCh. 5 - Prob. 53PCh. 5 - Prob. 54PCh. 5 - Prob. 55PCh. 5 - Prob. 56P
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- Which of the following statement about expected vesting period agrees with IFRS 2? A. The entity shall estimate the length of the expected vesting period at grant date, based on the most likely outcome of the performance condition. B. The entity shall estimate the length of the expected vesting period at measurement date based on the contractual obligations. C. The entity shall revise its estimate of the length of the vesting period annually. D. The estimate of the length of the expected vesting period shall be consistent with the assumptions used in estimating the fair value of the options granted, and may be subsequently revised.arrow_forwardDescribe the accounting procedures that must be followed by a lessee when employing the operational lease technique.arrow_forwardIdentify the management assertion and presentation and disclosure-related audit objective for the specific presentation and disclosure-related auditobjective: Read the fixed asset footnote disclosure to determine that the types of fixedassets, depreciation methods, and useful lives are clearly disclosed.arrow_forward
- The issue of security througha number of processes .once the SEC has commented to interest on the registration statement and a preliminary prospectus has been distributed to interest invetors,the investment bankers organizeroad shows and undertake book building in the process. Required: Explain the meaning and two [2]purposes of road showa as used in the preamble above.arrow_forwardIn performing risk assessment procedures for property, plant and equipment, an auditor may inquire of the client personnel which of the following questions? A. Are depreciation policies in accordance with applicable financial reporting framework? B. Are disposals of PPE properly utilized, removed from records including depreciation, and recorded in correct accounting period? C. All of the choices D. Are all PPE , including finance leases, properly authorized, recorded in accordance with the capitalization threshold (ex. 10,000) and in correct accounting period?arrow_forwardPrior to 2019, lessees did not include the right-of-use asset and the lease liability for operating leases on their balance sheets. Both FASB and IASB wrote new standards to require that lessees nearly always report an asset and liability on their balance sheets when they engage in a lease transaction. This accounting results in which of the following? Group of answer choices a more reliable estimation of the lease's value a better determination on whether the lessor held the risks and rewards of the leased asset's ownership a more faithful representation of the rights and obligations arising from leases All of the abovearrow_forward
- The IASB and FASB are collaborating on a joint project to revise accounting standards for leases. Briefly describe the direction the project is taking.arrow_forwardexplain the process of auditing the followingtransactions/accounts below. • Inventories• Property, plant, and equipment (PPE)• Renewal and reconditioning costs• Revenues• Rehabilitation bondsarrow_forwardWhich of the following statements is correct in accordance with AASB 16 Leases? Group of answer choices A lease contract, or part of a lease contract, conveys the right to transfer ownership of an asset for a period of time in exchange for consideration. Payments that are made by a lessee at commencement date are included in the initial amount recognised for the lease liability. Payment for executory costs reimbursed by the lessee after being paid by the lessor on behalf of the lessee are included in the calculation of lease payments. Variable lease payments may be increased or decreased during the lease term because of changes in facts and circumstances occurring after the asset is made available to the lessee to use, other than the passage of time.arrow_forward
- Fundamental Principles (Comprehensive). In each of the following, identify which ofthe elements of the fundamental principles is most applicable. In addition, discuss whataction(s) (if any) you believe auditors should take with respect to these issues.a. An entity has contacted you about performing its audit engagement. You have not previously served a client in the entity’s industry, which has many industry-specific accounting issues that are both technical and complex.b. An entity has entered into a number of lease agreements. Based on the requirements ofGAAP, you believe that these obligations meet the criteria for being classified as capitalleases; however, the entity has elected to treat these leases as operating leases, providingfull and complete disclosure of this treatment in the footnotes to the financial statements.c. Because of a disagreement with its current auditors, an entity has contacted you aboutconducting its current-year audit. However, because the previous auditors…arrow_forwardWhat are specific audit objectives? Explain their relationship to the general audit objectives. Identify the management assertion and general balance-related audit objective for the specific balance-related audit objective: All recorded fixed assets exist at the balance sheet date. Identify the management assertion and presentation and disclosure-related audit objective for the specific presentation and disclosure-related audit objective: Read the fixed asset footnote disclosure to determine that the types of fixed assets, depreciation methods, and useful lives are clearly disclosed.arrow_forward
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