Question

In connection with the examination of financial statements by an independent auditor, the client suggests that members of the internal audit staff be utilized to minimize audit costs. Which of the following tasks could most appropriately be delegated to the internal audit staff?

a. Selection of accounts receivable for confirmation, based upon the internal auditor's judgment as to how many accounts and which accounts will provide sufficient coverage.
b. Preparation of schedules for negative accounts receivable responses.
c. Evaluation of the internal control for accounts receivable and sales.
d. Determination of the adequacy of the allowance for doubtful accounts.

Answer 1

The task that could most appropriately be delegated to the internal audit staff is selection of accounts receivable for confirmation.

Step-by-step explanation:

The task that could most appropriately be delegated to the internal audit staff in connection with the examination of financial statements by an independent auditor is a. Selection of accounts receivable for confirmation, based upon the internal auditor's judgment as to how many accounts and which accounts will provide sufficient coverage. This task involves the internal audit staff using their expertise to determine which accounts should be selected for confirmation to ensure adequate coverage.

The other tasks listed in options b, c, and d are more complex and require a deeper understanding of accounting principles that are typically handled by the independent auditor.