The client prepared the following worksheet listing all activities in the marketable securities account for the year under audit. For purposes of this question, you may assume that there are no unusual securities except the note from XYNO Corporation (a related party) and a note from Allis-Chalmers Corporation (a customer).Assume also that control risk was assessed as moderate to high, and that the auditor decides to concentrate on direct tests of the account balance. The account balances at the beginning and end of the year per the company’s trial balance are as follows:

Required
Identify the audit steps needed to complete the audit of marketable securities for year end. You may assume that the client was audited by the same firm lastyear.

Marketable securities Allowance to reduce securities to market Balance per general ledger Beginning Balance $400,000 35,000 $365,000 Ending Balance $675,000 $35,000 $640,000 Interest income Dividend income Net gain on disposal of securities $25,000 $18,000 $ 32,000