Question

The auditor's count of the client's cash should be coordinated to coincide with the?

1) Consideration of the internal controls with respect to cash.
2) Close of business on the balance sheet date.
3) Count of investment securities.
4) Count of inventories.

Answer 1

The auditor's cash count should coincide with the close of business on the balance sheet date, which offers an accurate assessment of the company's cash position for the end of the reporting period. Other audit components are integral, but do not determine the timing of the cash count.

Step-by-step explanation:

The auditor's count of the client's cash is a critical step in the audit process. It should be coordinated to coincide with the close of business on the balance sheet date. This timing ensures that the cash count reflects the actual amount of cash on hand at the end of the reporting period, which provides for an accurate assessment of the company's cash position for financial statement purposes.

While consideration of the internal controls with respect to cash, count of investment securities, and count of inventories are also important components of a comprehensive audit, they do not dictate the timing of the cash count. Instead, these elements are evaluated in conjunction with the cash count to ensure the overall reliability of the financial information.