Procedures used by an auditor when conducting a subsequent events review include:
A) assessing continued compliance with borrowing limits and loan covenants.
B) enquiring of those charged with governance as to whether any subsequent events have occurred that may affect the financial report.
C) reading minutes of the meetings of the board of directors.
D) All of the above

Question

Quizplus · Accepted Answer

All of the choices above are procedures that an auditor would typically perform when conducting a subsequent events review. Assessing continued compliance with borrowing limits and loan covenants ensures that any changes in the borrower's financial position are taken into account. Enquiring of those charged with governance ensures that the auditor is informed of any subsequent events that may affect the financial report. Reading minutes of the meetings of the board of directors can help to identify any subsequent events that have occurred since the year-end. Therefore, all three choices are appropriate procedures for an auditor to use when conducting a subsequent events review.

Procedures Used by an Auditor When Conducting a Subsequent Events