A common comparison occurs when the auditor calculates the expected balance and compares it with the actual balance.The auditor's expected account balance may be determined by
A)using industry standards.
B)using credit bureau reports.
C)relating it to some other balance sheet or income statement account or accounts.
D)inquiring with the client.

Question

Quizplus · Accepted Answer

The auditor's expected account balance may be determined by relating it to some other balance sheet or income statement account or accounts. This is usually done using analytical procedures, where the auditor compares the account in question with other accounts that have a known relationship to it. This helps the auditor to identify any significant fluctuations or deviations from the expected balance, which may indicate errors or fraud. Using industry standards or credit bureau reports may be useful in some cases, but they may not always be relevant or reliable. Inquiring with the client may also provide useful information, but it should not be the only source of evidence.

A Common Comparison Occurs When the Auditor Calculates the Expected