37.To determine whether facts support management's intent to hold securities to maturity, an auditor might A. Study the entity's cash flow forecasts.B. Obtain published market quotations.C. Compare fair value of the securities to cost.D. Confirm that the securities are held by a broker.38.Which of the following controls would be most effective in ensuring that the proper custody of assets in the investing cycle is maintained? Independent personnel periodically compare the recorded balances in the investment subsidiary ledger with the contents of the safety deposit box.39.In auditing long-term bonds payable, an auditor most likely would 40.During an audit of an entity's stockholders' equity accounts, the auditor determines whether there are restrictions on retained earnings resulting from loans, agreements, or state law. This audit procedure most likely is intended to verify the ASB presentation and disclosure assertion of 41.In auditing intangible assets, an auditor most likely would review or recompute amortization and determine whether the amortization period is reasonable in support of the ASB balance assertion of A. Valuation.B. Existence.C. Completeness.D. Rights and obligations.
42.In confirming with an outside agent, such as a financial institution, that the agent is holding investment securities in the client's name, an auditor most likely gathers evidence in support of ASB balance assertion of existence and 43.The focus of controls in the finance and investment cycle is on
- Spring '12
- Financial audit, investment cycle