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The audit program for accounts payable for a client has been drafted, ensuring that the account is not understated. The auditor believes that the key
The audit program for accounts payable for a client has been drafted, ensuring that the account is not understated. The auditor believes that the key assertion at risk is cut-off and needs to be tested by sending confirmations to creditors.
- Explain whether the current audit process is appropriate. If not, suggest the appropriate process.
- Suggest one sampling method that can be used to test cut-off assertion. Justify your answer.
- The results of the testing of accounts payable are as follows
If the overall tolerable error was set at $62 000, what action would you take?
Stratum 1 2 Error found Sample total value Stratum total value $ 15,560.00 $ 156,500.00 $ 216,004.00 $ 5,946.00 $ 56,420.00 $ 85,641.00 $ 11,253.00 $ 78,560.00 $ 123,560.00 $ 7,200.00 $ 15,400.00 $ 35,800.00 $ 39,959.00 $ 306,880.00 $ 461,005.00 3 4 Total Stratum 1 2 Error found Sample total value Stratum total value $ 15,560.00 $ 156,500.00 $ 216,004.00 $ 5,946.00 $ 56,420.00 $ 85,641.00 $ 11,253.00 $ 78,560.00 $ 123,560.00 $ 7,200.00 $ 15,400.00 $ 35,800.00 $ 39,959.00 $ 306,880.00 $ 461,005.00 3 4 Total
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