Pick two account to analyze (Ex: Account receivable, Cash, Account
payable, Sales , cost of goods sold.)
analysis. (4 years)
1. Set level of materiality (Ex : change of 25% or higher )2. Make a conclusion for each account (1. point )o The auditor should pay more attention to the sales account. It decreased by 45 17 and by 66% in 2018. Interestingly, the percentage of change dropped in2019. However, the sales changes did not exceed our threshold limit of 25%,which means the changes is within the acceptable range.o The changes in the COGS were not significant. It was relatively the same duringthe last three years.3. Make a conclusion for Both Accounts (.5 point)o The COGS remained relatively the same despite the slight increase in the sale.The auditor must consider the cause of this inconsistency to ensure that no vicioussales were recoded or that no costs were missedFormula:(THE YEAR /THE BASE YEAR)*100 = CHANGE RELATIVE TO BASE YEAR
Solve the above question as in the example belowThe table below is a solution to a different question
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