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What is the role of an auditor in relation to outstanding liabilities?
  • a)
    Determining nominal account balances
  • b)
    Verifying the accuracy of prepaid expenses
  • c)
    Confirming the accuracy of accrued incomes
  • d)
    Verifying the payment of expenses due in the current year
Correct answer is option 'D'. Can you explain this answer?
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What is the role of an auditor in relation to outstanding liabilities?...

Role of an Auditor in Relation to Outstanding Liabilities:

  • Verifying the payment of expenses due in the current year: Auditors play a crucial role in verifying the accuracy of outstanding liabilities by ensuring that expenses due in the current year have been appropriately accounted for and paid. This involves reviewing financial records, invoices, and other relevant documents to confirm that all outstanding liabilities have been correctly recorded and settled.


By focusing on this specific aspect, auditors help ensure the financial health and accuracy of a company's financial statements. They help provide assurance to stakeholders that the company's outstanding liabilities are accurately reflected, which is essential for making informed decisions and maintaining transparency in financial reporting.
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What is the role of an auditor in relation to outstanding liabilities?...
An auditor's role in relation to outstanding liabilities involves verifying the payment of expenses that were due in the current year but have not been paid by the time the accounts were closed. The auditor ensures that these expenses are properly recognized as liabilities in the financial statements to present an accurate picture of the company's financial position.
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What is the role of an auditor in relation to outstanding liabilities?a)Determining nominal account balancesb)Verifying the accuracy of prepaid expensesc)Confirming the accuracy of accrued incomesd)Verifying the payment of expenses due in the current yearCorrect answer is option 'D'. Can you explain this answer?
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