Final answer:
The statement that the use of analytical procedures for auditing cash is limited is (b) false.
Step-by-step explanation:
The auditor's use of analytical procedures for auditing cash is not necessarily limited. Analytical procedures involve evaluating financial information by studying plausible relationships among data. These procedures can be part of the steps taken when performing an audit on cash balances, such as comparing the current period's cash balances and cash flows with those of prior periods, budgeted amounts, or industry averages to identify inconsistencies or fluctuations that need further investigation. Therefore, the statement is b. False.
However, it's important to note that while analytical procedures can be used, they are often complemented with other auditing techniques, such as tests of details, to provide reasonable assurance that the financial statements are free of material misstatement. The combination of these methods ensures the accuracy and reliability of the audit findings.