The audit objective that requires the auditor to determine that notes payable on the notes payable schedule are properly classified can be tested by performing the procedure to
A) confirm notes payable.
B) examine corporate minutes for loan approval.
C) examine notes, minutes, and bank confirmations for restrictions.
D) review the notes to determine whether any are with related parties.

Question

Quizplus · Accepted Answer

Reviewing the notes to determine whether any are with related parties helps ensure proper classification of notes payable, as related party transactions may require different disclosure or classification.

The Audit Objective That Requires the Auditor to Determine That