When auditing contingent liabilities, which of the following procedures would be least effective?
A)Reading the minutes of the board of directors.
B)Obtaining a legal letter.
C)Examining customer confirmation replies.
D)Examining invoices for legal services.

Question

Quizplus · Accepted Answer

Examining customer confirmation replies would be the least effective procedure for auditing contingent liabilities because customers would not have information about potential legal claims or liabilities. Rather, obtaining a legal letter and examining invoices for legal services would provide more relevant information about contingent liabilities. Reading the minutes of the board of directors could also provide insights into potential liabilities that management has identified and assessed.

When Auditing Contingent Liabilities, Which of the Following Procedures Would