There are many types of analytical procedures that the auditor can conduct during the planning stage of the financial statement audit.What is the purpose of comparing prepaid expenses and related expense accounts with those of prior years?
A)to understand the client's industry and business
B)to assess going concern
C)to identify possible misstatements
D)to reduce tests of controls

Question

Quizplus · Accepted Answer

Comparing prepaid expenses and related expense accounts with those of prior years can help identify possible misstatements by detecting any significant fluctuations or anomalies in account balances. This can alert the auditor to potential errors or fraud that may require further investigation.

There Are Many Types of Analytical Procedures That the Auditor