To reduce the risks associated with accepting fax responses to requests for confirmations of accounts receivable, an auditor most likely would

A. Examine the shipping documents that provide evidence for the existence assertion.

B. Verify the sources and contents of the faxes in telephone calls to the senders.

C. Consider the faxes to be nonresponses and evaluate them as unadjusted differences.

D. Inspect the faxes for forgeries or alterations and consider them to be acceptable if none are noted.

Question

Krystal

Business

27 May, 21:41

To reduce the risks associated with accepting fax responses to requests for confirmations of accounts receivable, an auditor most likely would

A. Examine the shipping documents that provide evidence for the existence assertion.

B. Verify the sources and contents of the faxes in telephone calls to the senders.

C. Consider the faxes to be nonresponses and evaluate them as unadjusted differences.

D. Inspect the faxes for forgeries or alterations and consider them to be acceptable if none are noted.

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Answers (1)

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Emmanuel Barton · Answer 1

The correct answer is letter "B": Verify the sources and contents of the faxes in telephone calls to the senders.

Explanation:

After a confirmation is sent to a debtor, it is a good practice to contact by phone the department of charge of receiving the document in the debtor's end to make sure they have received the confirmation. It is important also to verify the content of the confirmation so that the debtor agrees in the correctness of the document, which immediately gives them the responsibility of paying the amount bill.