Auditing Practice Questions:

23-25

23. The auditors have not been able to confirm a large account receivable, but they have satisfied themselves as to the proper amount of the receivables by means of alternative auditing procedures. The auditor's report on the financial statements should include: a. A description of the limitation of the scope of their examination and the alternative auditing procedure used, but an opinion qualification is not required b. An opinion qualification, but reference to the use of alternative auditing procedures is not required c. Both a scope qualification and an opinion qualification d. Neither a comment on the use of alternative procedure nor an opinion qualification. e. None of the above. 24. Which of the following audit procedure is most effective in testing credit sales for understatement? a. Age the accounts receivable b. Confirm account receivable balances c. Trace sample of initial sales slips through summaries to recorded general ledger sales d. Trace sample of recorded sales from ledger to initial sales slip. e. None of the above. 25. T/F. The primary control that prevents the shipping department from making unauthorized shipments of merchandise is the use of serially numbered shipping documents