An Auditor Compares This Year's Revenues and Expenses with Those

Multiple Choice

An auditor compares this year's revenues and expenses with those of the previous year and investigates all changes exceeding 10 per cent. By carrying out this procedure the auditor would be most likely to learn that:

A) an increase in property tax rates has not been recognised in the client's accrual.
B) the provision for uncollectible accounts is inadequate because of worsening economic conditions.
C) fourth-quarter payroll taxes were not paid.
D) the client changed its capitalisation policy for small tools.