ACCT 444 Week 3 Homework

1. Explain why recalculation tests are highly reliable but of relatively limited use.
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1. Give three examples of relatively reliable documentation and three examples of less reliable
documentation. What characteristics distinguish the two?
1. Give several examples in which the qualifications of the respondent or the qualifications of
the auditor affect the reliability of the evidence.
1. Explain why analytical procedures are important evidence even though they are relatively
unreliable by themselves.
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7-31 (Objective 7-4) As auditor of the Star Manufacturing Company, you have obtained
1. A trial balance taken from the books of Star one month before year-end:
2. There are no inventories consigned either in or out.
3. All notes receivable are due from outsiders and held by Star.
Required
Which accounts should be confirmed with outside sources? Briefly describe from whom they
should be confirmed and the information that should be confirmed. Organize your answer in the
following format:*