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Which of the following audit procedures would an auditor most likely perform to test controls relating to management's assertion concerning the completeness of sales transactions?
Suggested Answer: B
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Choice 'b' is correct. A report on internal control related matters noted in an audit should not state that there are no significant deficiencies in internal control, since this statement might erroneously imply that the auditor searched for such conditions.
Choice 'a' is incorrect. The auditor is permitted to state that no material weaknesses were identified during the audit. Typically this occurs in reports submitted to governmental authorities.
Choice 'c' is incorrect. The auditor may suggest that corrective follow-up action should be taken due to the relative significance of material weakness discovered.
Choice 'd' is incorrect. The auditor's report may state that his or her consideration of internal control would not necessarily disclose all significant deficiencies that exist.
39 comments · newest first
CH
Charlene
11 months ago
C is more about pricing, not completeness. B all the way!
KR
Kristel
11 months ago
A is about recomputing, but it doesn't check for completeness.
LA
Lai
12 months ago
Wait, are we sure B is the right answer? Sounds too straightforward.
TI
Timothy
12 months ago
I agree, B really targets unrecorded transactions.
FR
France
12 months ago
B seems like the best choice for completeness.
DO
Dominga
1 year ago
I feel like option D is more about credit policies, which doesn't really address completeness. I think I’d lean towards B or C.
CO
Cornell
1 year ago
I’m a bit confused about option A. Recomputing invoices seems more related to accuracy than completeness, right?
OL
Olga
1 year ago
I remember practicing a question similar to this where we had to identify procedures for completeness. I think verifying prenumbered documents is key.
FR
Francis
1 year ago
I think option B makes the most sense since it directly relates to ensuring all sales are recorded, but I'm not entirely sure.
LE
Levi
1 year ago
I'm pretty sure the answer is 3 copies, since that's the standard for locally-redundant storage. I'll double-check the Azure docs to confirm, but I feel confident about this one.
VI
Vi
1 year ago
I'll start by identifying the core IPMP requirements, then double-check my answer before submitting.
NO
Norah
1 year ago
B is definitely the way to go. I mean, who doesn't love a good prenumbered document inspection? It's like a treasure hunt for accountants!
JI
Jill
1 year ago
Keva: Absolutely, it's a crucial part of the audit process to ensure the integrity of financial statements.
CA
Carla
1 year ago
User 3: I think it's important to verify that all sales transactions are being recorded accurately.
KE
Keva
1 year ago
User 2: Definitely, it's a great way to test controls for completeness of sales transactions.
EL
Eladia
1 year ago
Wilford: It's important to have those controls in place to prevent any errors or fraud.
WI
Wilford
1 year ago
User 2: Definitely, it's like solving a puzzle to ensure completeness of sales transactions.
SO
Sol
1 year ago
User 1: I agree, inspecting prenumbered shipping documents sounds like a fun task.
GE
Gerri
1 year ago
User 1: I agree, inspecting prenumbered shipping documents sounds like a fun audit procedure.
GR
Gretchen
1 year ago
Hmm, I'm not sure. D) Inquiring about the credit granting policies might also be relevant, as that could reveal potential issues with the sales process.
CH
Charlena
1 year ago
C) Compare the invoiced prices on prenumbered sales invoices to the entity's authorized price list.
AL
Alton
1 year ago
B) Inspect the entity's reports of prenumbered shipping documents that have not been recorded in the sales journal.
CR
Cristina
1 year ago
A) Verify that extensions and footings on the entity's sales invoices and monthly customer statements have been recomputed.
JE
Jess
1 year ago
I agree, B is the correct answer. Verifying the completeness of the sales record is crucial, and checking the prenumbered shipping documents is a great way to do that.
AN
Antonio
1 year ago
User 3: I see your point, but I still think B is the most appropriate choice. Inspecting prenumbered shipping documents can help verify completeness.
LA
Laura
1 year ago
User 2: I disagree, I believe C is the best option. Comparing invoiced prices to the authorized price list ensures completeness.
AD
Adaline
1 year ago
User 1: I think A is the correct answer. Recomputing the extensions and footings on sales invoices is important for completeness.
MA
Mattie
1 year ago
B) Inspecting the reports of prenumbered shipping documents that have not been recorded in the sales journal seems like the best way to test the completeness of sales transactions. This would help identify any missing or unrecorded sales.
SH
Shaunna
1 year ago
Inquiring about credit granting policies could also be useful in ensuring completeness.
PA
Paulina
1 year ago
Yes, that could help too. It's important to use multiple procedures to test controls.
FR
Frank
1 year ago
But wouldn't verifying extensions and footings on sales invoices also help ensure completeness?
JO
Josefa
1 year ago
I agree, inspecting the prenumbered shipping documents is a good way to test completeness.
MA
Margurite
1 year ago
Inquiring about credit granting policies can help ensure consistent application of credit checks.
MA
Maurine
1 year ago
Verifying extensions and footings on sales invoices is also a good procedure.
KE
Kenneth
1 year ago
It's important to make sure all sales are being properly recorded.
KA
Katy
1 year ago
I agree, inspecting the reports of prenumbered shipping documents is a good way to test completeness.
RO
Roslyn
2 years ago
But wouldn't verifying extensions and footings ensure the completeness of sales transactions? That's why I think A is the best option.
AL
Alishia
2 years ago
I disagree, I believe the correct answer is C) Compare the invoiced prices on prenumbered sales invoices to the entity's authorized price list.
RO
Roslyn
2 years ago
I think the answer is A) Verify that extensions and footings on the entity's sales invoices and monthly customer statements have been recomputed.