For most audits, a proper cash receipts cutoff is less important than either the sales or the sales returns and allowances cutoff.

Question

Quizplus · Accepted Answer

A proper cash receipts cutoff is less important than either the sales or the sales returns and allowances cutoff because the cash receipts cutoff only affects the timing of revenue recognition, while the sales and sales returns and allowances cutoffs affect both the timing and the amount of revenue recognized.

For Most Audits, a Proper Cash Receipts Cutoff Is Less