Auditors are concerned with the addresses provided for customers in the confirmation of accounts receivable because of which of the following reasons?
A)Confirmations are selected based upon zip codes.
B)A P.O.box is more reliable than a street address.
C)Confirmations should be sent only to business addresses and not residential.
D)The address may be routed to the client for retrieval and fraudulent signing.

Question

Quizplus · Accepted Answer

The address provided in the confirmation of accounts receivable may be routed to the client for retrieval and fraudulent signing. This means that the client may intercept the confirmation and falsely confirm the balance, leading to an inaccurate representation of the accounts receivable. Therefore, auditors need to be careful when selecting the addresses to send confirmations to and make sure that they are valid and reliable.

Auditors Are Concerned with the Addresses Provided for Customers in the Confirmation