Accounts payable confirmations are used to test
A) Both the existence and completeness audit assertions.
B) Only the existence audit assertion.
C) Only the completeness audit assertion.
D) Either existence or completeness, depending upon the response rate.

Question

Quizplus · Accepted Answer

Accounts payable confirmations are used to test both the existence and completeness audit assertions. The existence assertion is tested by confirming that the accounts payable balances are owed to the company by verifying the amounts with the creditors. The completeness assertion is tested by confirming that all of the accounts payable balances are included in the confirmation request and that any differences or discrepancies are investigated.

Accounts Payable Confirmations Are Used to Test