CAF-8 · Chapter 9 · Question 5 of 10
Which of the following procedures would help an auditor identify understated (complete) trade payables at year-end?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Performing a search for unrecorded liabilities by reviewing bank payments and supplier invoices received *after* the year-end.
Explanation
Completeness of liabilities is tested by looking at what was paid *after* the year-end to see if any of those payments related to obligations that existed *at* the year-end but were not recorded.
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