In describing the cycle approach to segmenting an audit, which of the following statements is NOT true?
A) All general ledger accounts and journals are included at least once.
B) The 'inventory and warehousing' cycle may be audited at any time during the engagement since it is unrelated to the other cycles.
C) Some journals and general ledger accounts are included in more than one cycle.
D) The 'capital acquisition and repayment' cycle is closely related to the 'acquisition of goods and services and payment' cycle.

Question

Quizplus · Accepted Answer

The 'inventory and warehousing' cycle is not unrelated to the other cycles and should be audited during the appropriate time frame based on its interrelationship with the other cycles. This statement is therefore not true.

In Describing the Cycle Approach to Segmenting an Audit, Which