Knowledge of the client's business is essential for tests related to reviewing the accounts payable listing and master file for related parties and debit balances.

Question

Quizplus · Accepted Answer

Knowledge of the client's business is essential to understand the nature and scope of the accounts payable, related party transactions, and debit balances that need to be reviewed during testing. Without this understanding, the auditor may miss key information or fail to identify unusual transactions that require additional scrutiny. Thus, A is the correct answer.

Knowledge of the Client's Business Is Essential for Tests Related