The tests of details of balances procedure which requires the auditor to review transactions near the balance sheet date for the proper period satisfies which audit objective?
A) classification
B) existence
C) completeness
D) cutoff

Question

Quizplus · Accepted Answer

The "tests of details of balances procedure" performed by the auditor is used to address the cutoff objective. This is because it involves reviewing transactions near the balance sheet date to ensure they are recorded in the correct period, which is problematic if they are recorded in the wrong period. Thus, by performing this procedure, the auditor can ensure that transactions are posted in the correct period, which satisfies the cutoff objective. None of the other audit objectives are directly related to reviewing transactions near the balance sheet date.

The Tests of Details of Balances Procedure Which Requires the Auditor