Which of the following circumstances would most likely cause an auditor to suspectthat material misstatements exist in the financial statements?(1) The assumptions used in developing the prior year’s accounting estimates havechanged.(2) Differences between reconciliations of control accounts and subsidiary recordsare not investigated.(3) More confirmation requests were sent this year relative to last year.(4) Management consults with another CPA firm about complex accounting matters.
Which of the following circumstances would most likely cause an auditor to suspectthat material misstatements exist in the financial statements?(1) The assumptions used in developing the prior year’s accounting estimates havechanged.(2) Differences between reconciliations of control accounts and subsidiary recordsare not investigated.(3) More confirmation requests were sent this year relative to last year.(4) Management consults with another CPA firm about complex accounting matters.
Auditing: A Risk Based-Approach to Conducting a Quality Audit
10th Edition
ISBN:9781305080577
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter10: Auditing Cash And Marketable Securities
Section: Chapter Questions
Problem 67RSCQ
Related questions
Question
Which of the following circumstances would most likely cause an auditor to suspect
that material misstatements exist in the financial statements?
(1) The assumptions used in developing the prior year’s accounting estimates have
changed.
(2) Differences between reconciliations of control accounts and subsidiary records
are not investigated.
(3) More confirmation requests were sent this year relative to last year.
(4) Management consults with another CPA firm about complex accounting matters.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Auditing: A Risk Based-Approach to Conducting a Q…
Accounting
ISBN:
9781305080577
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
South-Western College Pub
Auditing: A Risk Based-Approach (MindTap Course L…
Accounting
ISBN:
9781337619455
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
Cengage Learning
Auditing: A Risk Based-Approach to Conducting a Q…
Accounting
ISBN:
9781305080577
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
South-Western College Pub
Auditing: A Risk Based-Approach (MindTap Course L…
Accounting
ISBN:
9781337619455
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
Cengage Learning