A purpose of tests of controls for shipping is to determine whether: (a) (b) (c) (d) 13. Billed goods are shipped. Shipments are made in accordance with approved sales and orders, Sales orders are properly recorded. Shipping personnel sends goods to related parties. A purpose of tests of controls for billing is to determine whether: (a) (b) (c) (d) 14. Billing personnel process returned goods properly. Sales orders agree with shipping documents. Sales orders have been approved by credit department personnel. Billed goods have been shipped. In the revenue and collection cycle, the auditor checks the numerical sequence of shipping documents. This procedure is related to which of the following assertions? (a) Valuation or allocation. (b) Rights and obligations. (c) Occurrence. (d) Completeness. 15. 16. Horizontal analysis refers to (a) The change in a suspect's net worth from the beginning to the end of a period. (b) The trend of income from year to year of persons suspected of fraud. () Changes of financial statement numbers and ratios across several years. Financial statement amounts expressed each year as a proportion of a base amount. (d) 17. During the initial planning phase of an audit, a CPA most likely would: (a) (b) (c) Discuss the timing of the audit procedures with the client's management. Inquire of the client's attormey as to whether any unrecorded claims are probable of assertion. Test specific internal control activities that are likely to prevent fraud Evaluate the reasonableness of the client's accounting estimates of inventory obsolescence. (d)