11 During an audit of a clients capital cycle the auditor ch

11. During an audit of a client\'s capital cycle, the auditor checks whether preferred stock and bonds are adequately backed by sinking funds. This procedure most likely is designed to achieve the specific audit objective of a. existence. b. completeness. c. valuation and allocation. d. understandability.

Solution

Solution: valuation and allocation

Explanation: Accuracy, valuation and allocation – means that amounts at which assets, liabilities and equity interests are valued, recorded and disclosed are all appropriate.