If auditors believe there is a risk that expensincurred before year-end will be excluded from the current year's expenses, they will:
A) Send out confirmation requests to a sample of the client's debtors.
B) Trace transactions recorded close to year-end to source documentation.
C) Perform analytical review analysis on the client's statement of financial position.
D) None of the above.

Question

Quizplus · Accepted Answer

By tracing transactions recorded close to year-end to source documentation, auditors can ensure that all expenses incurred before year-end have been properly recorded in the current year's financial statements. The other options listed are not relevant to the specific risk mentioned in the question.

If Auditors Believe There Is a Risk That Expensincurred Before