What is a blank confirmation?
Blank confirmations require the customer to input the amount that they owe the company (your audit client). Blank forms will often provide a greater amount of assurance; however, they will often result in lower responses as people are less likely to make the effort to fill them out. Blank confirmations provide the highest level of assurance.
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What is a positive confirmation?
When the audit team sends positive confirmations, Customers of the company will receive a confirmation from the auditor and will be asked to send back a statement with whether or not they agree with the confirmation of the auditor.
Do bank confirmations test the existence assertion?
Yes, bank confirmations are to verify that the cash exists in the bank account. Bank confirmations are sent to the 3rd party banks and the banks will respond and either verify the cash amount or they could say the cash does not exist! Most audit teams use confirmations.com to simplify the process of sending bank […]
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 […]