Why is it important to obtain an understanding of the internal control system?
A) weak internal controls may increase the risk of material misstatement.
B) to determine the level of inherent risk.
C) because strong internal controls indicate management integrity.
D) all of the above

Question

Quizplus · Accepted Answer

Understanding the internal control system is crucial because weak internal controls can increase the risk of material misstatement in financial reporting. This understanding helps auditors assess the risk of material misstatement and plan their audit procedures accordingly.

Why Is It Important to Obtain an Understanding of the Internal