1. Long-lived assets are typically immaterial for most organizations.
2. Patents are an example of long-lived assets.
3. The pervasiveness of management estimates is a factor that heightens the inherent risk associated with long-lived assets.
4. An inherent risk associated with intangible long-lived assets is the difficulty in determining the cost of the asset.
5. A fraud technique common for long-lived assets is the overstatement of assets though overvaluing the existing assets.
6. A fraud technique used by WorldCom management was to capitalize items that should have been expensed.
7. Auditors should expect clients to have written policies for the acquisition and disposal of long-lived assets.
8. A formal budgeting process that is tied to the acquisition of long-lived assets would not be considered a control over long-lived assets.

  • CreatedSeptember 22, 2014
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