Subsequent Events

Auditors try to identify predictable relationships when using analytical procedures. Relationshiipss involvingtransactions fromwhich of the following accounts most likely would yield the highest level of evidence? a. accounts receivable b. interest expense c. accounts payable d. Travel and entertainment expense

In the audit of notes payable, which balance-related audit objective is generally oneof the most important for the auditor to verify?(1) Notes payable reflected on the balance sheet at the end of the year exist.(2) Notes payable due to related parties are properly reflected on the balance sheet.(3) Existing notes payable are included on the balance sheet as of year end.(4) Notes payable are reflected at net realizable value as of the balance sheet date

Which of the following engagement planning procedures would most likely assist the auditor in identifying related-party transactions before the balance-sheet date?a. Interviewing internal auditors about their reporting responsibilities.b. Reviewing accounting records for recurring transactions occurring near year-end.c. Inspecting communications with the client’s legal counsel regarding recorded contingentliabilities.d. Scanning the minutes for significant transactions with members of the board of directors

8. An auditor should be aware of subsequent event that provide evidence concerning conditions that did not exist at year end but arose after year end. These events may be important to the auditor because they may: a. Have been recorded based on preliminary accounting estimates. b. Require adjustments to the financial statements as of the year end. c. Have been recorded based on year-end tests for asset obsolescence. d. Require disclosure to keep the financial statement from being misleading.     9. Analytical procedures used in planning an audit should focus on: a. Identifying material weaknesses in internal control. b. Enhancing the auditor’s understanding of the client’s business. c. Testing individual account balances that depend on accounting estimates. d. Evaluating the adequacy of evidence gathered concerning unusual balances.

Which of the following procedures would an auditor most likely perform to obtain evidence about the occurrence of subsequent events? A. confirming a sample of material accounts receiveable established after year-end. B. Comparing the financial statements being reported on with those of the prior period. C. Investigating personnel changes in the accounting department occurring after year-end. D. Inquiring as to whether any unusual adjustments were made after year-end.

Describe the audit procedures you would use to learn about each of the situations listed.   Begin by identifying all of the audit procedures you would use to learn about situation 1. ​(Select the 4 choices that​ apply.)     A.Analyze legal expense for the period under audit and review invoices and statements of legal counsel for indications of contingent liabilities.   B.Review records for unusual journal entries made to the equity accounts​ (Common stock and Retained​ earnings) subsequent to​ year-end.   C.​Discuss, specifically, any related party transactions with management and include information in letter of representation.   D.Obtain letters from all major attorneys performing legal services for the client as to the status of pending litigation or other contingent liabilities.   E.Confirm details of stock transactions with registrar and transfer agent.   F.Review financial statements of​ affiliate, and where related party transactions are​ apparent, make direct…

Management Assertions. Your audit manager has asked you to explain the PCAOB assertions by using an account on the balance sheet at your audit client. For the accounts receivable account, please define each of the PCAOB assertions, using the accounts receivableaccount as a way to illustrate each assertion. You are encouraged to reference Exhibit 1.5 tohelp you answer this question

Discuss the auditor’s responsibility for detecting subsequent events(a) prior to the completion of field work;(b) prior to signing the audit report, and(c) between the date of the audit report and the issuance of the financialreport.

Analytical procedures consist of evaluating financial information by studying financial and nonfinancial data and looking for plausible or implausible relationships. The procedures can range from making simple comparisons to using complex models involving many relationships and elements of data. They can involve time-series comparisons of recorded amounts and ratios developed from recorded amounts, and they always include comparison to expectations developed by the auditors Describe three purposes of analytical procedures. ) Identify three sources of information from which an auditor develops expectations when performing analytical procedures

asap F Identify the primary audit objectives that auditors hope to accomplish by confirming a client's year-end accounts receivable. Explain the difference between "positive" and "negative" confirmation requests and discuss the quality of audit evidence yielded by each.

Develop TWO audit procedures to gather sufficient and appropriate testing for Operating expenses, Accounts Receivables, Inventory, Cost of Goods Sold, Dividends, Cash and Cash Equivalents, Other Income and Retained Earnings. Explain the objective of each procedure: What risk or issue are you trying to address with the procedure?

We discussed a number of assertions about account balances, classes of transactions, and disclosures contained in financial statements. These assertions include existence and occurrence, rights and obligations, completeness, cutoff, valuation and disclosure.  When we gather audit evidence, we gather evidence to support financial statement assertions.    Required:   Describe how each of these assertions relates to Accounts Receivable. Conor & Evan, CPAs are the auditors for Mojito, Inc. In the course of the audit, Conor & Evan select a sample of Mojito’s customers from the Accounts Receivable subsidiary ledger and send letters to them asking for confirmation of the Accounts Receivable balances owed to Mojito, Inc. Describe which of the assertions will be supported by the evidence obtained from the confirmations sent to Mojito’s customers.  Explain how the evidence supports the assertion and, if it does not support the assertion, why not

Audit standards require auditors to _______. conduct specific audit procedures to identify subsequent events that may occur up through the date of the auditor’s report conduct specific audit procedures to identify subsequent events that may occur after the date of the auditor’s report. apply optional use of analytical procedures to increase assurance levels related to subsequent events delegate auditing of subsequent events to the internal audit function   A compilation engagement is _______. an audit of the financial statements, whereby an auditor expresses an opinion on the financial statements an audit of the system of internal control, whereby an auditor expresses an opinion on the system of internal control when an accounting firm assists management in the presentation of financial statements but does not audit, review, nor provide assurance as to whether the financial statements are presented fairly. when an audit firm assists management in the presentation of financial…

The following are specific balance-related audit objectives applied to the audit of accounts receivable (a. through i.) and management assertions about account balances (1 through 6). The list referred to in the specific balance-related audit objectives is the list of the accounts receivable from each customer at the balance sheet date. i (Click the icon to view the audit objectives.) i (Click the icon to view the management assertions.) Requirement For each specific balance-related audit objective, identify the appropriate management assertion. (Hint: See table.) Specific balance-related audit objective There are no unrecorded receivables. b. Uncollectible accounts have been provided for. C. Receivables that have become uncollectible have been written off. d. All accounts on the list are expected to be collected within 1 year. The total of the amounts on the accounts receivable listing agrees with the general ledger balance for accounts receivable. a. e. Management assertion