ExpertMedium1 markMultiple Choice
CPA · Question 31 · Area IV: Reporting
An auditor is engaged to perform a review of a nonissuer's financial statements under SSARS (AR-C 90). Which of the following procedures is REQUIRED?
An auditor is engaged to perform a review of a nonissuer's financial statements under SSARS (AR-C 90). Which of the following procedures is REQUIRED?
Answer options:
A.
Testing the operating effectiveness of internal controls.
B.
Confirming accounts receivable with customers.
C.
Obtaining a management representation letter.
D.
Observing the physical inventory count.
How to approach this question
Review = Inquiry + Analytics + Rep Letter. No testing of controls, no confirmations, no observation.
Full Answer
C.Obtaining a management representation letter.✓ Correct
AR-C 90 requires the accountant to obtain a written representation letter from management for all review engagements.
Common mistakes
Thinking audit procedures (confirmations, observation) apply to reviews.
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