CA Inter P5 · Chapter 2 · Question 5 of 11
Which of the following is NOT a preliminary engagement activity required at the beginning of the current audit engagement under SA 300?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) Performing tests of details on sales cut-off around the year-end
Explanation
SA 300 requires the auditor, at the beginning of the engagement, to perform the procedures required by SA 220 regarding continuance of the client relationship and the specific engagement, evaluate compliance with ethical requirements including independence, and establish an understanding of the terms of engagement (SA 210). Cut-off testing is a further audit procedure performed in response to assessed risks, not a preliminary engagement activity.
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