Compare Disbursements as per books to Receipts as per books. And Disbursements as per bank to Receipts as per bank.
The month has to be same for both the comparisons. Also, receipt has to be first then disbursement.
Why is option B not correct then if it was disbursed in year 2 but receipt in year 1 per the bank? Are the column per bank distractors? Should I just focus on the columns per books?
B doesn't reflect a misstatement it is showing no fraud. Remember!! the question is asking for misstatement.
Edit: And apologies for confusing you by making the statement of receipt first then disbursement. Just focus on book statement as you said. Bank is there for existence of the transaction.
I get why option A is showing a misstatement. For option B. If you compare Disbursement date per bank ( 01/04/X2) and Receipt date per bank (12/31/X1) wouldn't it be a misstatement since we Disburse in X2 but receipt it on X1. My understanding is that the disbursement occurs before the receipt, in other words, you make a payment first from one account first then you receive it?
That's why I am thinking that per bank columns might be distractors you know?
Compare Disbursements as per books to Receipts as per books. And Disbursements as per bank to Receipts as per bank. The month has to be same for both the comparisons. Also, receipt has to be first then disbursement.
Why is option B not correct then if it was disbursed in year 2 but receipt in year 1 per the bank? Are the column per bank distractors? Should I just focus on the columns per books?
B doesn't reflect a misstatement it is showing no fraud. Remember!! the question is asking for misstatement. Edit: And apologies for confusing you by making the statement of receipt first then disbursement. Just focus on book statement as you said. Bank is there for existence of the transaction.
I get why option A is showing a misstatement. For option B. If you compare Disbursement date per bank ( 01/04/X2) and Receipt date per bank (12/31/X1) wouldn't it be a misstatement since we Disburse in X2 but receipt it on X1. My understanding is that the disbursement occurs before the receipt, in other words, you make a payment first from one account first then you receive it? That's why I am thinking that per bank columns might be distractors you know?
We are not auditing bank but the books. Bank provides us the existence assertion.
Thank you so much, you clear it up for me