CA D, during the course of audit of a company engaged in export business, notices that credit facilities taken by company during the year from a…
CA Intermediate · Auditing and Ethics · MTP · May 2024
CA D, during the course of audit of a company engaged in export business, notices that credit facilities taken by company during the year from a bank for 10 crores have almost been fully utilized during the year. On going through sanction letter provided by bank to company, it is observed that rate of interest stipulated in sanction letter is 8% p.a. Financial statements of company show bank interest amounting to 60.00 lacs. Which type of substantive analytical procedure is being used by CA D?
Suggested Answer and Working Notes:
Correct Answer: Option (C)
(C) Reasonableness tests
Topics: Audit Evidence
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