The aged accounts receivable report is utilized by the auditor to accomplish which of the following?
A)Encourage the client to collect on receivables that are long past due.
B)Select the type of confirmations that will be sent to banks.
C)Assess the adequacy of the allowance for doubtful accounts.
D)Identify debits in the receivables balance that should be reclassified to payables.

Question

Quizplus · Accepted Answer

The aged accounts receivable report is used to assess the adequacy of the allowance for doubtful accounts. It provides information on the length of time that accounts have been outstanding, which can help the auditor determine whether the client has adequately provided for potential bad debts. Options A, B, and D are not directly related to the purpose of the aged accounts receivable report.

The Aged Accounts Receivable Report Is Utilized by the Auditor