Auditing Unit 3

What is the purpose of vouching unpaid expenses?

• To check for error possibility

• To conduct analysis and inspection

• To verify accrued income

• To confirm outstanding assets

Why are assets verified during an audit?

• To verify tax department rules

• To ensure they actually exist

• To check agreements about rate

• To determine method of computation

How is unearned income typically treated in accounting?

• As an expense

• As an asset

• As a liability

• As revenue

What is the purpose of vouching outstanding assets?

• To ensure proper value

• To confirm liabilities

• To check rent deed

• To verify accrued income

Why are liabilities verified during an audit?

• To conduct analysis and inspection

• To verify accrued income

• To check for error possibility

• To ensure they actually exist

What is the main focus of vouching income accrued?

• Reviewing minutes of BOD meetings

• Examining agreements

• Questioning key officials

• Checking provisions made

What is the purpose of vouching impersonal ledger?

• To check for error possibility

• To conduct analysis and inspection

• To confirm outstanding assets

• To verify accrued income

What is the significance of secret reserves in auditing?

• To hide financial information

• To manipulate financial statements

• To create a buffer against losses

• To deceive auditors

Why is it important to verify liabilities by accident?

• To verify tax department rules

• To check for error possibility

• To determine method of computation

• To ensure proper value