If a confirmation of an accounts receivable balance is not returned by the customer, the auditor might validate the receivable by _______.
A)looking at evidence of subsequent cash receipt in the amount of the billing to the customer
B)asking the client to obtain the evidence and forward it to the auditor
C)requesting the internal audit function contact the customer
D)confirming prior receivables by the same client

Question

Quizplus · Accepted Answer

If the confirmation is not returned by the customer, the auditor might validate the receivable by looking at evidence of subsequent cash receipt in the amount of the billing to the customer. This is because if the customer paid the amount, it confirms the existence of the receivable. Option B is not the best choice as it does not ensure independence of evidence. Option C is not a common approach, and option D is not relevant as it pertains to prior receivables.

If a Confirmation of an Accounts Receivable Balance Is Not