Testing for unrecorded liabilities involves vouching a sample of disbursements made after fiscal year end to determine
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Testing for unrecorded liabilities involves vouching a sample of disbursements made after fiscal year end to determine whether the underlying liabilities for the disbursements were recorded at the balance sheet date.
a. Discuss some sampling strategies for the test of unrecorded liabilities.
b. How might an unrecorded liability elude a well-conceived and executed sampling strategy (other than through ordinary sampling risk)?
c. What are the implications for the audit if an unrecorded liability is found?
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Related Book For
Auditing Assurance And Risk
ISBN: 9780324313185
3rd Edition
Authors: W. Robert Knechel, Steve Salterio, Brian Ballou
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