Question: QUESTION THREE A practice that is becoming very common in the verification of receivables is to circularize the debtors or obtain direct confirmation. Required: Explain

QUESTION THREE

A practice that is becoming very common in the verification of receivables is to circularize the debtors or obtain direct confirmation.

Required:

  1. Explain three benefits that would accrue to an auditor from carrying out debtors circularization. (6 marks)
  2. Identify two types of errors and two types of frauds that may be revealed or detected through the circularization of debtors. (4 marks)
  3. Describe the criteria used when selecting the debtors who should be circularized. (6 marks)
  4. Highlight two limitations of using debtors circularization as an audit

procedure. (4 marks)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Q:

Does anyone know where this article come from? I wanna cite it as a resource!! Thanks! 41 Auditing Insurance Companies 41.1 OVERVIEW OF THE INDUSTRY (a) Structure of the Industry, (b) Reinsurance,...

Q:

Does anyone know where this article come from? I wanna cite it as a resource!! Thanks! 41 Auditing Insurance Companies 41.1 OVERVIEW OF THE INDUSTRY (a) Structure of the Industry, (b) Reinsurance,...

Q:

Does anyone know where this article come from? I wanna cite it as a resource!! Thanks! 41 Auditing Insurance Companies 41.1 OVERVIEW OF THE INDUSTRY (a) Structure of the Industry, (b) Reinsurance,...

Q:

Need help with these multiple choice questions for internal audit final exam. Due in 2 hours. QUESTION 1 RsQ_004Without management direction and assumption of responsibility, it would be...

Q:

I would like assistance with assignment 3 and 4 on the attached document I have been struggling with the subject and its my last AUI4863/102/0/2016 Tutorial letter 102/0/2016 ADVANCED INTERNAL AUDIT...

Q:

i need this by early morning. His mother later remarried--a fellow named MacAdam--and Johnny grew up in his stepfather's home with his mother, stepfather, sisters, brothers, and the stepfather's...

Q:

Question 1 (10 marks) Car Cheap Ltd is a publicly listed company that retails budget-priced car parts and accessories to the public. The company has 45 stores across Australia, and six warehouses,...

Q:

Review case 4.1 Enron Corporation and Andersen, LLP . Complete the following Required questions related to this case, 1-5, in approximately 75 to 90 words. QUESTIONS TO BE ANSWERED: Review case 4.1...

Q:

Case 9-2 Continental A.G. Write a report of approximately 750 words that addresses the following points: Examine Continental?s financial statements for unusual accounting practices that may have a...

Q:

Controller, Judy Koch, in a recent speech said, "I rarely see a real variable cost or a truly fixed cost." What did she mean? Include in your response an explanation of the difference in behavior of...

Q:

Chloroethene adds hydrogen chloride more slowly than ethene, and the product is 1,1-dichloroethane. How can you explain this using resonance and inductive effects? HCI CI CI

Q:

Is this an appropriate application for systems contracting? If so, what are the possible savings? Eleanor Jamison, the director of purchasing for Advanced Computer Logic (ACL), was becoming...

Q:

5.55 College Poll (Example 11) Refer to the table in Exercise 5.47. Suppose a person is randomly selected from this group. Is being female independent of answering YES?

Q:

5. Develop a scenario comparing two PH programs and involving the use of a CBA.

Q:

C What kinds of mediated communication do both hearing and deaf people share? Can individuals use them to overcome communication barriers between hearing and deaf people?

Q:

why we face Listening Challenges?

Q:

what is Listening in Context?