In establishing the existence and ownership of an investment held by a corporationin the form of publicly traded stock, an auditor should inspect the securities or(1) obtain written representations from management confirming that the securitiesare properly classified as trading securities.(2) inspect the audited financial statements of the investee company.(3) confirm the number of shares owned that are held by an independent custodian.(4) determine that the investment is carried at the lower of cost or market.
In establishing the existence and ownership of an investment held by a corporationin the form of publicly traded stock, an auditor should inspect the securities or(1) obtain written representations from management confirming that the securitiesare properly classified as trading securities.(2) inspect the audited financial statements of the investee company.(3) confirm the number of shares owned that are held by an independent custodian.(4) determine that the investment is carried at the lower of cost or market.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In establishing the existence and ownership of an investment held by a corporation
in the form of publicly traded stock, an auditor should inspect the securities or
(1) obtain written representations from management confirming that the securities
are properly classified as trading securities.
(2) inspect the audited financial statements of the investee company.
(3) confirm the number of shares owned that are held by an independent custodian.
(4) determine that the investment is carried at the lower of cost or market.
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