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Is the audit team required to send accounts receivable confirmations?

Yes, for most firms, the audit team is required send confirmations to customers to confirm their outstanding balance at year-end. If the audit team determines that sending confirmations is a waste of time, they can perform alternative procedures, but that typically results in extensive documentation.

The primary reason is to test the existence & occurrence assertion. The audit must decide on what type of accounts receivable confirmation to send.

The three types that can be sent include positive, negative, or blank confirmations.


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