The folloawing are various potential miestatements due to erors or fraud (1 through 7) performing to gather evidence to determine whether the error or fraud is present . and a list of auditing procedures (a. through h.) the auditor would consider (Cick the icon to view the potential misstatermenits.) (Click the icon to view the list of auditing procedures) For each possible misstatement identily one audit procedure that would be most effective in providing evidence regarding the potential misstatement Listed auditing procedures may be used once, more than once, or not at al Possible Audit Misstatement Procedure 1. The audtor suspects that a lapping scheme exists because an accounting department employee who has access to cash receipts also maintains the accounts recelvable ledger and refuses to take any vacation or sick days 2. The auditor suspects that the entity is inappropriately increasing the cash reported orn its balance sheet by drawing a check on one account and not recording it as an outstanding check that account and simultaneously recording it as a deposit in a second account 3. The entity's cash receipts of the first few days of the subsequent year were properly deposited Choose trom any drop-down list and then continue to the next questiorn The following are various potential misstatements due to errors or fraud (1 through 7), and a liest of auditing procedures (a. through h) the audor would consider performing to gather evidence to determine whether the eror or fraud is present (Click the lcon to view the potential misstatements) (Click the icon to view the list of auditing procedures) For each possible misstatement, idontify one audit procedure that would be most effective in providing evidence regarding the potential misstatement Listed auditing procedures may be used once, more than once, or not at all check on that account and simultaneously recording it as a deposit in a second account 3. The entity's cash receipts of the first lew days of the subsequent year were properly deposited n bs gerel oporatingccutr nd owe he autor suspects hthe ontey recorded the cash receipts in its books during the last week of the year under audit The audifor noticed a significant increase in the number of times that petty cash was reimbursed during the year and suspects that the custodian is stealing from the petty cash fund 5. The audtor suspects that a kiting scheme exists because an accounting department employere who can issue and record checks seems to be leading an unusually kuxurious lifestyle 6 During tests of the reconciliation of the payroll bank account, the auditor notices that a check to an employee is significantly larger than other payroll checks Cassde au lecid Cecks Seems to be leadling an unusually luxunous lifestyle. 6. During tests of the reconciliation of the payroll bank account, the auditor notices that a check to an employee is significantly larger than other payroll checks 7. The auditor suspects that the controller wrote several checks and recorded the cash disbursements just before year-end but did not mail the checks until after the first week of the subsequent year 3 of 3 (0 complete) sstatements due to errors or fraud (1 through 7), and a list of auditing procedures (a. through h List of Auditing Procedures a. Compare the details of the cash receipts journal entries with the details of the corresponding daily deposit slips. b. Count the balance in pety cash at year-end. Agree gross amount on payroll checks to approved hours and pay rates. d. Obtain the cutoff bank statement and compare the cleared checks to the e. Examine invoices, receipts, and other documentation supporting f Send a standard bank confirmation confirming the balance in the bank at year-end reconciliation. reimbursement of petty cash. e 9 nh year-end Examine payroll checks clearing after year-end with the payroll journal Prepare a bank transfer schedule Print Done and then continue to the next