What type of analytical procedure would an auditor most likely use in developing relationships among balance sheet accounts when reviewing the financial statements of a nonissuer?

Question

Quizplus · Accepted Answer

Choice "C" is correct. Ratio analysis is often used to examine relationships between balance sheet accounts. Choice "A" is incorrect. Trend analysis would be more appropriate for examining income statement accounts. Choice "B" is incorrect. Regression analysis would not likely be used since twenty to thirty past observations are generally required to reliably make estimates. Choice "D" is incorrect. Risk analysis would not be used to evaluate relationships between balance sheet accounts.

What Type of Analytical Procedure Would an Auditor Most Likely