Week 7 HW - Chapter 7. 7-29. a 1. External 2. Internal 3....

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Chapter 7. 7-29. a 1. External 2. Internal 3. External 4. External 5. Internal 6. Internal 7. Internal 8. Internal 9. External 10. Internal 11. External 12. External 13. Internal 14. External 15. Internal 16. External 17. External 18. External b. External evidence is more reliable because the owners of documentation are both the client and third party. Therefore, both members are in agreement about the information stated in the documents. In addition, some external documentation is prepared very carefully and reviewed by attorneys. 7-30. 1. Inquiries of the client 2. Observation 3. Physical examination 4. Confirmation 5. Recalculation 6. Confirmation 7. Documentation 8. Analytical procedures 9. Inquiries of the client 10. Reperformance 11. Observation 12. Physical examination 13. Analytical procedures 14. Documentation 15. Inquiries of the client 16. Analytical procedures 17. Documentation 18. Recalculation 19. Physical examination 20. Confirmation
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7-31. a. Examination of purchase invoices Confirmation with seller/supplier/vendor b. Auditor physically counts the inventory Auditor confirms the receivable of inventory with seller/supplier c. Examination of bank deposits and receipts. Auditor confirms the receivable with customer d. Examination of purchase invoices Titles of ownership examination e. Examination of purchase invoices Confirmation with seller/supplier/vendor f. Auditor physically counts the inventory Examination of sale prices g. Auditor physically counts petty cash Examination and confirmation of sources of petty cash receivable 7-32. a. Confirmations are more reliable because the outside party is independent comparable to the client. b. Confirmation of insurance policies and bank balances are highly reliable because these
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This note was uploaded on 07/27/2011 for the course AUDIT 307 taught by Professor N/a during the Spring '11 term at Strayer.

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Week 7 HW - Chapter 7. 7-29. a 1. External 2. Internal 3....

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