Which of the following audit procedures would the auditor use to identify conditions that may indicate doubt that the company will continue as a going concern for a reasonable period of time?
A)net liability positions
B)positive operating cash flows
C)ability to pay creditors on due dates
D)change from cash-on-delivery to credit transactions with suppliers
E)loss of key management without replacement
F)both A and E
G)both B and C
H)both D and E

Question

Quizplus · Accepted Answer

The audit procedures that would help identify doubt that the company will continue as a going concern for a reasonable period of time are identifying net liability positions (A) and loss of key management without replacement (E). Both of these procedures highlight situations where the company may not be able to sustain its operations. Therefore, option F, which includes both A and E, is the best choice for this question.

Which of the Following Audit Procedures Would the Auditor Use