An auditor might suspect that the auditee is in financial difficulty if ________.
A) the auditee offers more generous customer credit terms
B) the auditee takes a large bank loan at market rates
C) sales increase and inventory increases
D) purchases increase and payables increase

Question

Quizplus · Accepted Answer

Offering more generous customer credit terms can be a sign that the auditee is trying to boost sales quickly due to financial difficulties.

An Auditor Might Suspect That the Auditee Is in Financial