In the audit of a private company, _______.
A)an auditor's tests of controls are unrelated to the planned audit strategy
B)an auditor's tests of controls are largely dictated by the planned audit strategy
C)the auditor is not subject to reporting and notification requirements
D)the auditors should preemptively determine the entities ability to pay for the audit and request a certain percentage in advance

Question

Quizplus · Accepted Answer

In the audit of a private company, an auditor's tests of controls are largely dictated by the planned audit strategy. The overall audit approach and scope are based on the auditor's understanding of the entity, its environment, and its internal control, which should be tested before substantive procedures are performed. Therefore, the tests of controls are largely dictated by the planned audit strategy.

In the Audit of a Private Company, _______