This year is the first time that, as a normal practice in a client's business, accounts receivable may be pledged, assigned, factored, or sold at discount.The audit procedure which would disclose these practices is:
A) discussions with the client.
B) a review of the minutes of the board of directors meetings.
C) examination of correspondence files.
D) all of the above

Question

Quizplus · Accepted Answer

All of the above options would be necessary to disclose the practices of pledging, assigning, factoring, or selling accounts receivable at discount. Discussions with the client would provide insight into any agreements or arrangements made with third parties. A review of the minutes of the board of directors meetings may indicate any authorization or approval for these actions. Examination of correspondence files could reveal any contracts, invoices, or other documents related to the transactions. Therefore, all of these audit procedures would be necessary to obtain sufficient evidence about the client's accounts receivable practices.

This Year Is the First Time That, as a Normal