Which of the following circumstances most likely would cause an auditor to believe that material misstatements may exist in an entity's financial statements?

Question

Quizplus · Accepted Answer

Choice "A" is correct. Confirmation of accounts receivable confirm the existence of the receivable. A lower than expected response rate could be indicative of fictitious customer accounts. Choice "B" is incorrect. In a computerized accounting environment, audit trails generally exist for only a short time. Choice "C" is incorrect. The management representation letter should be signed and dated on the date of the auditor's report. Choice "D" is incorrect. Consultation with other accountants would not cause an auditor to believe material misstatements have occurred.

Which of the Following Circumstances Most Likely Would Cause an Auditor