Which of the following is a required procedure in a review of a nonissuer's financial statements?

Answer options:

Confirmation of accounts receivable.

Observation of inventory.

Obtaining a management representation letter.

Assessment of fraud risk.

How to approach this question

Review = Inquiry + Analytics + Rep Letter. No substantive testing (Confirm/Observe).

Full Answer

C.Obtaining a management representation letter.✓ Correct

In a review engagement, the accountant must obtain a written representation letter from management. Procedures like confirmation, observation, and fraud risk assessment are specific to audits.

Common mistakes

Selecting audit procedures for a review.

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