The auditor's starting point for verifying disposals of property, plant, and equipment is the:
A) client's schedule of recorded disposals.
B) file of shipping documents.
C) equipment account in the general ledger.
D) equipment subsidiary ledger.

Question

Quizplus · Accepted Answer

The client's schedule of recorded disposals is the starting point for verifying disposals of property, plant, and equipment because it should list all disposals during the year, including the date, description of the item, sale price, and any gain or loss on the disposal. The auditor can then trace this information to supporting documentation, such as sales invoice or purchase agreement, to ensure the disposals were correctly recorded and accounted for. The other options may be used in conjunction with the schedule of recorded disposals but are not the primary starting point.

The Auditor's Starting Point for Verifying Disposals of Property, Plant