Identify the risks for accounts receivable at Victoria

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Question - You are the audit senior on the Victoria Waterworks Ltd. audit. You have collected the following information about the accounts receivable:

The AR turnover ratio was eight times for the current year and twelve times for the prior year. The AR balance has increased from $52,140 in the prior year to $176,983 in the current year.

In an attempt to boost sales, Victoria Waterworks Ltd. loosened its credit-granting policies during the year and also extended payment terms for its customers.

Required - Identify the risks for accounts receivable at Victoria Waterworks Ltd. and the related assertions. Document the audit procedures to address the risks.

Reference no: EM133015310

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