The audit objective to determine that existing loans payable are included in the loans payable schedule (completeness) is accomplished by the following test of balances procedure:
A) Examine duplicate copies of loan agreements for principal and interest rates.
B) Trace the individual loans payable on the schedule to the master file.
C) Review the bank reconciliation for new loans credited directly to the bank account by the bank.
D) Review loans to determine whether any are related- party loans or accounts payable.

Question

Quizplus · Accepted Answer

Reviewing the bank reconciliation for new loans credited directly to the bank account by the bank helps ensure that all loans are recorded and included in the loans payable schedule, addressing the completeness objective.

The Audit Objective to Determine That Existing Loans Payable Are