Question 4 Which of the following are key control procedures for the revenue bus

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Question 4

Which of the following are key control procedures for the revenue business process?

A. segregation of transaction trails

authorization procedures

C. documented duties

D. independent transaction trails

E. physical controls that limit access to assets

F. both a and b

G.both c and d

both b and e

Question 5

In the revenue business process, the auditor might perform the following analytical procedures:

A. Compare sales revenue, accounts receivable, sales returns and allowance, bad debt expense, and allowance for uncollectible accounts for the current year to the prior year. Investigate changes from the auditor's expectations that appear to be unreasonable.

B. Compare sales revenue, accounts payable, sales returns and allowance, bad debt expense, and allowance for uncollectible accounts for the current year to the prior year. Investigate changes from the auditor's expectations that appear to be unreasonable.

C. Calculate the accounts receivable turnover ratio and the number of days outstanding in accounts receivable for the current and prior years. Investigate a change from the auditor's expectations if it appears to be unreasonable.

D. Calculate the accounts receivable turnover ratio and the number of days outstanding in accounts payable for the current and prior years. Investigate a change from the auditor's expectations if it appears to be unreasonable.

E. Consider the number of vendor accounts for the current year and the prior year and new accounts added and lost in each year.

F. both a and c

G. both b and e

Question 6

The auditing standards presume that the auditor will request confirmation of the accounts receivable balances unless

the balance in accounts receivable is immaterial

B. the use of confirmations would be effective if the amounts were significant

C. the auditor can reduce the risk of issuing an audit opinion to an acceptable low level without confirming accounts receivable

the client believes that confirmations are not necessary

A. segregation of transaction trails

B.

authorization procedures

C. documented duties

D. independent transaction trails

E. physical controls that limit access to assets

F. both a and b

G.both c and d

H.

both b and e

Explanation / Answer

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