An auditor is reviewing the minutes of board meetings to determine whether any securities are pledged as collateral. This test of the detail of balances relates to the audit objective of
A) rights.
B) cutoff.
C) realizable value.
D) classification.

Question

Quizplus · Accepted Answer

The audit objective of rights relates to verifying that the entity has legal ownership or rights to the assets and liabilities included in the financial statements. Reviewing the minutes of board meetings to determine whether any securities are pledged as collateral helps to confirm that the entity has the right to use those securities as collateral.

An Auditor Is Reviewing the Minutes of Board Meetings to Determine