Natherson, CPA, is engaged to audit the financial statements of Lewis Lumber for the year ended December 31. Natherson obtained and documented an understanding of internal control relating to the purchasing process and set control risk at the maximum level. Natherson requested and obtained from Lewis a schedule analyzing prepaid insurance as of December 31 and sent confirmation requests to Lewis’ insurance broker.

Required:
a. Identify two substantive analytical procedures that Natherson could use to verify prepaid insurance.
b. What substantive audit procedures should Natherson conduct on the schedule of prepaid insurance?