ACCA Audit and Assurance (F8) Practice Exam

What defines a positive confirmation request?

1. Request to confirm only if there is a disagreement

2. Request to confirm the accuracy of the balance shown

3. Request for general feedback on invoice accuracy

4. Request for statement of payments received

The correct answer is: Request to confirm the accuracy of the balance shown

A positive confirmation request is defined as a request sent to a third party that asks them to confirm whether the information provided (typically account balances) is accurate, regardless of whether they agree or disagree with it. Selecting the option that indicates a request to confirm the accuracy of the balance shown accurately reflects the essence of positive confirmation. This approach is used by auditors to obtain direct verification from third parties, ensuring that the auditor obtains explicit validation of the information rather than relying on inferred data or assumptions. In the context of positive confirmation, the emphasis is on obtaining an explicit response to verify the amounts stated, making it a reliable form of assurance regarding the completeness and accuracy of financial statements. This method is particularly useful when the auditor desires to corroborate the amounts recorded in the financial records with what is being reported by third parties.