Obtain the year end bank reconciliation for each cash account and perform the following::
a. Foot the bank reconciliation and agree the balance per books to the general ledger.
Evidence type: reperformance
testing: Accuracy
Evidence Type: Inspection of Documents:
Testing: completness
b. Agree the balance per the bank to the related confirmation.
Evidence type: confirmation
Assertion: existence, accuracy
c.Trace material deposits in transit to the cash receipts journal and/or the deposit slip [or the cutoff statement ], noting whether deposits was made prior to the end of the period
Evidence type: Inspection of Documents
Assertion tested: Completeness, cutoff
Evidence type: Reperformance
Assertion tested: Accuracy
d. Examine cancelled checks and or the bank cutoff statement. For checks written prior to the end of the period and clearing after the end of the period, trace to the outstanding check list
Evidence
type: Inspection of documents
Assertion Type: Cutoff, Accuracy, rights & obligations, classification
e. Discuss other material reconciling items with appropriate client personnel.
Evidence type: Inquiry
Assertion tested: Completness, existence
f. Examine material inter-bank transfers made during the last week of the period to ascertain whether disbursments/ receipts were recorded in the correct period.
Evidence type: Inspection of documents
Assertion tested:
cutoff, completness, accuracy
The following describes a situation in which an auditor has to determine the most appropriate standards to follow.
The audited company is headquartered in Paris but has substantial operations within the United States [60% of all operations]; has securities registered with the SEC; and is traded on the New York Stock Exchange [NYSE]. The company uses International Financial Reporting Standards [IFRS] for its accounting framework.
Which of these would be the most
appropriate set of auditing standards to follow?
a. PCAOB.
b. Only the AICPA standards would be appropriate.
c. Either PCAOB or AICPA.
d. Either IAASB or AICPA.
Audit evidence is the information used by the auditor in arriving at the conclusions on
which the audit opinion is based, and includes the information contained in the accounting
records underlying the financial statements and other information.
Accounting records include the records of initial entries and supporting records, such as checks and records of electronic fund transfers; invoices; journal entries, and other adjustments to the
financial statements that are not reflected in formal journal entries; and records such as work sheets and spreadsheets supporting cost allocations, computations, reconciliations, and
disclosures. Many times the entries in the accounting records are initiated, recorded,
processed, and reported in electronic form.
Other information is audit evidence that
includes minutes of meetings; confirmations from third parties; industry analysts' reports;
comparable data about competitors
[benchmarking]; controls manuals; information
obtained by the auditor from such audit procedures as inquiry, observation, and inspection;
and other information developed by, or available to, the auditor that permits the auditor to
reach conclusions through valid reasoning.
Glencoe Accounting: First Year Course
1st EditionGlencoe McGraw-Hill
548 solutions
Cost Accounting: A Managerial Emphasis
15th EditionCharles T. Horngren, Madhav V Rajan, Srikant M. Datar
853 solutions
Accounting
9th EditionCharles T. Horngren, M Suzanne Oliver
1,286 solutions
Fundamentals of Financial Management, Concise Edition
8th EditionEugene F. Brigham, Joel F Houston
508 solutions
Recommended textbook solutionsFinancial Accounting
4th EditionDon Herrmann, J. David Spiceland, Wayne Thomas
1,097 solutions
Introduction to Managerial Accounting
5th EditionEric W. Noreen, Peter C. Brewer, Ray H Garrison
519 solutions
Financial Accounting
4th EditionDon Herrmann, J. David Spiceland, Wayne Thomas
1,097 solutions
Financial Accounting
9th EditionCharles T. Horngren
1,286 solutions