In the planning stage,analytical procedures are used to
A) identify potential problem areas.
B) provide direct evidence about the balances in accounts.
C) determine the mathematical correctness of the financial statements.
D) all of these.

Question

Quizplus · Accepted Answer

Analytical procedures are primarily used during the planning stage to identify potential problem areas. These procedures involve comparing the financial statement data with expected results based on prior periods, budgets, or industry standards. Analytical procedures do not provide direct evidence about the balances in accounts, nor do they determine the mathematical correctness of the financial statements, although they may alert auditors to potential discrepancies that require further investigation.

In the Planning Stage,analytical Procedures Are Used to