PCAOB AS 2310, The Confirmation Process and AU-C 505 state there is a presumption that the auditor will request the confirmation of receivables during an audit unless there are special conditions.Which of the following are among these conditions?
A)Accounts receivable are immaterial to the financial statements.
B)The use of confirmations would be ineffective as an audit procedure.
C)The auditor's assessed level of risk of material misstatement at the relevant assertion level is high.
D)No other planned substantive procedures address the assessed risk.

Question

Quizplus · Accepted Answer

According to PCAOB AS 2310 and AU-C 505, there is a presumption that the auditor will request confirmation of receivables unless there are special conditions. These special conditions include situations where accounts receivable are immaterial to the financial statements and where the use of confirmations would be ineffective as an audit procedure. If the assessed level of risk of material misstatement is high or if there are no other planned substantive procedures that address the assessed risk, these are not considered special conditions that would exempt the auditor from requesting confirmations.

PCAOB AS 2310, the Confirmation Process and AU-C 505 State