The auditor is most likely to verify accrued commissions payable in conjunction with the
A) Sales cutoff review.
B) Verification of employees.
C) Review of post balance sheet date disbursements.
D) Examination of trade accounts payable.

Question

Quizplus · Accepted Answer

Accrued commissions payable are typically recognized based on the timing of sales, and therefore are most likely to be reviewed in conjunction with the sales cutoff review. This review ensures that sales are recorded in the correct period and that any resulting accruals are necessary and accurate. Verification of employees, review of post balance sheet date disbursements, and examination of trade accounts payable are all relevant to other aspects of the financial statements, but not specifically to the verification of accrued commissions payable.

The Auditor Is Most Likely to Verify Accrued Commissions Payable