Which of the following audit procedures is best for identifying unrecorded trade accounts payable?
A)Reviewing cash disbursements recorded subsequent to the balance sheet date to determine whether the related payable applies to the prior period.
B)Investigating payables recorded just prior to and just subsequent to the balance sheet date to determine whether they are supported by receiving reports.
C)Examining unusual relationships between monthly accounts payable balances and recorded cash payments.
D)Reconciling vendors' statements to the file of receiving reports to identify items received just prior to the balance sheet date.

Question

Quizplus · Accepted Answer

Reviewing cash disbursements recorded subsequent to the balance sheet date helps in identifying whether the disbursements relate to liabilities that were incurred before the balance sheet date but were not recorded, thus identifying unrecorded trade accounts payable.

Which of the Following Audit Procedures Is Best for Identifying