When comparing an initial audit with a subsequent year audit for a particular client,the scope of audit procedures for which of the following accounts would be expected to decrease the most?
A)Accounts receivable.
B)Cash.
C)Marketable securities.
D)Property,plant,and equipment.

Question

Quizplus · Accepted Answer

Property, plant, and equipment are audited to ensure that they are accurately recorded on the financial statements because they often represent a significant investment for a company. Once the initial audit is completed and the assets are established on the books, the subsequent year's audit will likely involve fewer procedures for this account. Accounts receivable, cash, and marketable securities are all accounts that require ongoing monitoring and testing, so their scope of audit procedures would likely be similar between the initial audit and subsequent year audits.

When Comparing an Initial Audit with a Subsequent Year Audit