Which of the following procedures most likely would provide an auditor with evidence about whether an entity's internal control activities are suitably designed to prevent or detect material misstatements?
A) Performing analytical procedures using data aggregated at a high level.
B) Re-performing the controls for a sample of transactions.
C) Observing the entity's personnel applying the controls.
D) Vouching a sample of transactions directly related to the controls.

Question

Quizplus · Accepted Answer

Observing the entity's personnel applying the controls would provide the auditor with firsthand evidence about the design and effectiveness of the controls in preventing or detecting material misstatements. It allows the auditor to assess whether the controls are being applied consistently by the personnel and whether any weaknesses or deficiencies in the controls are being addressed appropriately. The other choices may provide some evidence, but they are less direct and may not give as much insight into the effectiveness of the controls.

Which of the Following Procedures Most Likely Would Provide an Auditor