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Question - Adem Hassen, CPA, was auditing ABC Company. Adem sent positive accounts receivable confirmations to a number of ABC customers. He received a number of returned confirmations marked "we do not confirm balances because we are on voucher system."
Required -
A. List three audit procedures that Adem might use to ensure the validity of these accounts.
B. Identify and describe the two forms of account receivable confirmation requests and indicate what factors Adem should consider in determining when to use each.
C. Assume Adem has received a satisfactory response to the confirmation requests. Describe how Adem could evaluate collectability of the trade account receivable.
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