It is stated in the chapter that understanding a client's business is important to the conduct of
Question:
It is stated in the chapter that understanding a client's business is important to the conduct of an audit.
Required
a. Explain how an understanding of a business and the business environment would be important to the auditor in evaluating accounts such as:
1. Inventory
2. Allowance for uncollectible accounts
3. Warranty liability and warranty expenses
b. Explain how the understanding of the business may provide value-added services that the auditor might be able to use in order to assist a privately held client.
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Related Book For
Auditing A Business Risk Approach
ISBN: 978-0538476232
8th edition
Authors: Karla Johnstone, Audrey Gramling, Larry Rittenberg
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