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Cross-Referencing in Accounting: Importance & Risks in Financial Auditing
1.Which of the following is/are (a) purpose(s) of cross-referencing? I.To indicate where certain numbers or other data originated II.To ensure consistency among all the working papers and data audited III.To determine that all items have been audited in a timely manner IV.To ensure an "audit trail" of workdone A.I,II B.I.II.IV C.I, Il, Ill D.All of the above 2.Which IPE Risk does the following scenario maps to?() Freight information was manually entered into the IT program, and the entry clerk missed entering the quantity shipped. A.The data processed by the IT application from which the IPE is produced is not complete or accurate B.The data extracted from the IT application into the IPE is not the intended data or is not complete. C.The computations or categorizations performed in the creation of the IPE from the IT application are inaccurate. D.The data output from the IT application to the EUC tool is modified or lost in the transfer. E.The information added or changed (including computations and categorizations) using the EUC tool is incomplete, inaccurate or inappropriate.
  1. B. I, II, IV. The purpose of cross-referencing in auditing includes indicating the origin of numbers or other data, ensuring consistency among working papers and data, and establishing an audit trail of the work done.

  2. A. The data processed by the IT application from which the IPE is produced is not complete or accurate.