After finishing the review phase of the study and evaluation of internal control in an audit engagement, the auditor should perform tests of controls on:
A) those controls in which significant deficiencies were identified.
B) a random sample of the controls that were reviewed.
C) those controls that the auditor plans to rely upon.
D) those controls that have a material effect upon the financial statement balances.

Question

Quizplus · Accepted Answer

The auditor should perform tests of controls on those controls that the auditor plans to rely upon. This will allow the auditor to determine if the controls are operating effectively and can be relied upon to detect or prevent material misstatements in the financial statements. Testing a random sample or only those controls with significant deficiencies or material effect may not provide sufficient assurance about the overall effectiveness of the internal control system.

After Finishing the Review Phase of the Study and Evaluation