The audit procedure "Examine canceled check for authorized signature, proper endorsement, and cancellation by the bank" is used to test the occurrence objective for cash disbursements.

Question

Quizplus · Accepted Answer

The given audit procedure is used to verify that the cash disbursement actually occurred as recorded in the cash disbursements journal. It ensures that the checks were properly authorized, endorsed and canceled by the bank, which is a part of the occurrence objective. Hence, the statement is true.

The Audit Procedure "Examine Canceled Check for Authorized Signature, Proper