External documentation involves the auditors examination of documents that have

External documentation involves the auditors

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Terms: Internal and external documentation; Reliability of evidenceDiff: ModerateObjective: LO 7-4AACSB: Reflective thinking skills29
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40) Confirmations are among the most expensive type of evidence to obtain.ATerms: Confirmations; Cost of evidenceDiff: EasyObjective: LO 7-4AACSB: Reflective thinking skills41) Whenever practical and reasonable, the confirmation of accounts receivable is required of CPAs.ADiff: EasyObjective: LO 7-4AACSB: Reflective thinking skills42) Inquiries of clients and recalculations normally have a low cost associated with them.ADiff: EasyObjective: LO 7-4AACSB: Reflective thinking skills43) When analytical procedures reveal unusual fluctuations in an account balance, the auditor will probably perform fewer tests of details for that account and increase the tests of controls related to the account.A) TrueB) FalseAnswer: Terms: Analytical procedures reveal unusual fluctuationsBDiff: EasyObjective: LO 7-4AACSB: Reflective thinking skills44) The type of audit evidence known as inquiry requires the auditor to obtain oral or written information from the client in response to questions.Answer: ATerms: Audit evidence; InquiryDiff: EasyObjective: LO 7-4AACSB: Reflective thinking skills30
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45) Auditor judgment is the primary determinant in determining the amount of evidence gathered.ATerms: Auditor judgment; EvidenceDiff: ModerateObjective: LO 7-4AACSB: Reflective thinking skills46) Analytical procedures must be used in the planning and completion phases of the audit.ADiff: ModerateObjective: LO 7-4AACSB: Reflective thinking skills47) Confirmations are ordinarily used to verify account balances, but may be used to verify transactions.A) TrueB) FalseAnswer: Terms: Confirmations to verify balances and transactionsADiff: ModerateObjective: LO 7-4AACSB: Reflective thinking skills
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