REQUIRED TO ANSWER:
Question 1. Discuss the auditors' approach to the verification of liabilities and assets.
Question 2. Which do you consider the more significant step in establishing strong internal control over accounts payable transactions: the approval of an invoice for payment or the issuance of check in payment of an invoice? Discuss.
Question 3. Discuss how the auditors coordinate the year-end cutoff of accounts payable with their observation of the year-end physical inventory.
Question 4. Discuss the purpose of the auditors' review of cash payments subsequent to the balance sheet date.
Question 5. Discuss what kind of documentary evidence created outside the client's organization is particularly important to the auditors in verifying accrued property taxes.