When reviewing and testing the process used by management in determining the allowance for bad debts, which of the following would not be involved?
A) reviewing projected allowances for future periods.
B) ascertaining management's procedures for determining the estimate and considering their reliability.
C) ensuring that the procedures have been properly followed.
D) identifying the assumptions underlying the estimate and considering their reasonableness.

Question

Quizplus · Accepted Answer

Reviewing projected allowances for future periods is not involved in testing the current process for determining the allowance for bad debts. The focus is on current procedures, their reliability, proper application, and the reasonableness of underlying assumptions, not on future projections.

When Reviewing and Testing the Process Used by Management in Determining