Before proceeding with tests of details of cash balances, the auditor should _______.

Question

Quizplus · Accepted Answer

Before conducting tests of details of cash balances, the auditor should ensure that an understanding has been obtained regarding the entity and its environment and the importance of cash balances to the entity. This helps in determining material misstatements and ensuring that appropriate audit procedures are followed. confirming cash balances with the firm's creditors or issuing a tentative audit opinion related to cash is not a necessary step before conducting further tests of cash balances.

Before Proceeding with Tests of Details of Cash Balances, the Auditor