For each procedure listed below, identify the type of audit test it best represents.

5 types of audit tests including tests of details of balances, tests of control, tests of transactions, risk assessment procedures, and analytical procedures.

1. Send confirmations for accounts receivable ending balance

2. Compare dates and amounts on raw materials purchase orders with the purchases journal throughout the year

3. Perform alternative procedures for non-responses on positive cash confirmations sent

4. Perform inventory test counts during client's count (inventory observation) to test year end balance

5. Review raw materials purchase order for proper manager approval and sign off

6. Compare inventory turnover ratios for the past 3 previous years

7. Perform cash cutoff procedures (testing outstanding checks and deposits in transit)

8. Assess inherent risk of inventory cycle

9. Compute the ratio of inventory write-offs relative to year end balances for the past 5 years

10. Observe whether bank statements are properly reconciled for 2 out of 12 months during the year

Answer rating: 100% (QA)

1 Send confirmations for accounts receivable ending balance Tests of details of balances 2 Compare d... View the full answer