You were in the final stages of your audit of the financial statements of Ozine Corporation for the year ended December 31, 2013, when you wereconsulted by the corporation’s president, who believes there is no point to your examiningthe year 2014 acquisitions journal and testing data in support of year 2014 entries. Hestated that (a) bills pertaining to 2013 that were received too late to be included in theDecember acquisitions journal were recorded as of the year-end by the corporation byjournal entry, (b) the internal auditor made tests after the year-end, and (c) he willfurnish you with a letter certifying that there were no unrecorded liabilities.a. Should a CPA’s test for unrecorded liabilities be affected by the fact that the clientmade a journal entry to record 2013 bills that were received late? Explain.
You were in the final stages of your audit of the financial statements of Ozine Corporation for the year ended December 31, 2013, when you wereconsulted by the corporation’s president, who believes there is no point to your examiningthe year 2014 acquisitions journal and testing data in support of year 2014 entries. Hestated that (a) bills pertaining to 2013 that were received too late to be included in theDecember acquisitions journal were recorded as of the year-end by the corporation byjournal entry, (b) the internal auditor made tests after the year-end, and (c) he willfurnish you with a letter certifying that there were no unrecorded liabilities.a. Should a CPA’s test for unrecorded liabilities be affected by the fact that the clientmade a journal entry to record 2013 bills that were received late? Explain.
You were in the final stages of your audit of the financial statements of Ozine Corporation for the year ended December 31, 2013, when you wereconsulted by the corporation’s president, who believes there is no point to your examiningthe year 2014 acquisitions journal and testing data in support of year 2014 entries. Hestated that (a) bills pertaining to 2013 that were received too late to be included in theDecember acquisitions journal were recorded as of the year-end by the corporation byjournal entry, (b) the internal auditor made tests after the year-end, and (c) he willfurnish you with a letter certifying that there were no unrecorded liabilities.a. Should a CPA’s test for unrecorded liabilities be affected by the fact that the clientmade a journal entry to record 2013 bills that were received late? Explain.
You were in the final stages of your audit of the financial statements of Ozine Corporation for the year ended December 31, 2013, when you were consulted by the corporation’s president, who believes there is no point to your examining the year 2014 acquisitions journal and testing data in support of year 2014 entries. He stated that (a) bills pertaining to 2013 that were received too late to be included in the December acquisitions journal were recorded as of the year-end by the corporation by journal entry, (b) the internal auditor made tests after the year-end, and (c) he will furnish you with a letter certifying that there were no unrecorded liabilities. a. Should a CPA’s test for unrecorded liabilities be affected by the fact that the client made a journal entry to record 2013 bills that were received late? Explain.
Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.
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