Pengxiang Zhang Auditing Chapter11 HW 17. Send further requests by registered mail along with return receipt request.

The auditor may make a phone call to determine the balance or ask the reason for nt receiving a reply to the written request. 19. An unusual huge number of sales transactions, which were recorded just before the balance sheet date, should be completely investigated by the auditors. It can reflects inappropriate cut-of sales transactions at the year-end or recording of wrong or fictitious sales. The auditors should investigate properly all sales invoice and match them with shipping documents and customer s orders. He should also discuss this with the related employee. 29. It is not possible for the auditors to issue unqualified audit report in these circumstances. Confirmation of account receivable by doing direct communication with customer is a presumed procedure and an inability to carry out such procedure when issuing an unqualified report requires auditor to do justification in his working papers. The auditors should usually disclaim an opinion on the financial statements when they have been prohibited by the client to confirm these receivables. 30. a. When auditors sent confirmation request to debtors whose accounts receivables were acknowledged as uncollectible, then he should determine that receivables were good when they were initially recorded in the account. Auditors should also determine that the accounts were not met and the proceeds stolen. b. The solar executive seems to believe that auditors are mainly concerned with the collectability or valuation of notes and accounts receivable. Actually, the main purpose of the confirmation process is to establish that receivable are valid or genuine and that the customers exist. 35. a. 2 b. 1 c. 3 d. 4 e. 2 f. 1 g. 2 h. 2 i. 2 j. 1 k. 3 l. 2 36. audit procedure classification of audit procedure A. 3 9 b. 1 9 c. 4 9 d. 5 9 e. 6 10 f. 7 9 g. 2 10 37. a. 2 b. 3 c. 1 d. 5 e. 3 f. 2 g. 1 47. #5 Zimber should conclude that the check was duly submitted on December 28 by examining the supporting documentation. # 22 Zimber should conclude whether these goods were constantly shipped and if so, determine that whether they have been returned. The existence or nonexistence of a shipping document would in this situation deliver a starting point for this analysis #47 Zimber should refer second request to the Big Edge. #51 Zimber should conclude whether the check was acknowledged and duly recorded in cash receipts journal.

#62 Zimber should conclude address of Pibson Gonker Corporation. #68 Zimber should merely conclude that the check was duly received initial in January. #72 while this receivable would appear to be confirmed without exception, the note may lead the auditors to an inquiry of whether the right of goods return on these and other is distinctive for the industry and whether any kind of allowance for returns is essential. #77 Zimber should inspect the documents terms supportive to the transaction to conclude whether this is a consignment or sale. #79 Zimber should study the shipment term to conclude whether a valid sale has arisen.