Which audit procedure would be used to test for the existence balance-related audit objective?
A) Trace ten accounts from the aged trial balance to the accounts receivable master file.
B) Confirm accounts receivable.
C) Review large sales returns and allowances before and after the balance sheet date.
D) Trace ten accounts from the trial balance to the accounts on the master file.

Question

Quizplus · Accepted Answer

Confirming accounts receivable directly with the customer helps to test for the existence balance-related audit objective. It verifies that the accounts receivable listed on the client's trial balance actually exist and are owed by their customers. Option A and D relate to tracing accounts, which would test for the completeness objective instead. Option C relates to testing for the valuation objective.

Which Audit Procedure Would Be Used to Test for the Existence