During an audit of suspense accounts the internal auditor found that there were no written policies on how suspense accounts should be treated. The auditor also found that suspense account balances…

Question

Options

• AThe auditor should conclude that suspense accounts were not being cleared on a timely basis
• BThe auditor should ask management whether any undocumented policies exist and. if so,
• CThe auditor should conclude that the clearing of suspense accounts was timely and appropriate
• DThe auditor should rely on his professional judgment and experience to develop criteria for

• A
  3% (2)
• B
  83% (49)
• C
  8% (5)
• D
  5% (3)

Explanation

When an internal auditor finds that there are no written policies regarding the treatment of suspense accounts, the most appropriate first response is to inquire with management about any undocumented policies or procedures that may be in place. This approach helps the auditor understand the existing practices and assess their adequacy. Jumping to conclusions without this understanding could lead to inaccurate audit findings. Ensuring that the auditor comprehensively understands all relevant practices is crucial before evaluating their effectiveness or making recommendations.

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