The audit objective to determine that existing loans payable are included in the loans payable schedule (completeness)is accomplished by the following test of balances procedure:
A) Trace the individual loans payable on the schedule to the master file.
B) Examine duplicate copies of loan agreements for principal and interest rates.
C) Review loans to determine whether any are related-party loans or accounts payable.
D) Review the bank reconciliation for new loans credited directly to the bank account by the bank.

Question

Quizplus · Accepted Answer

Reviewing the bank reconciliation for new loans credited directly to the bank account by the bank helps ensure that all loans are recorded and included in the loans payable schedule, addressing the completeness assertion.

The Audit Objective to Determine That Existing Loans Payable Are