Narratives, flowcharts, and internal control questionnaires are three common methods of:
A) designing the audit manual and procedures.
B) documenting the auditor's understanding of internal controls.
C) documenting the auditor's understanding of the client's organisational structure.
D) testing the internal controls.

Question

Quizplus · Accepted Answer

Narratives, flowcharts, and internal control questionnaires are all methods used to document the auditor's understanding of internal controls. They are not used to design the audit manual and procedures or to test internal controls, although they may be helpful in those processes. While they may provide some context regarding the client's organizational structure, that is not their primary purpose.

Narratives, Flowcharts, and Internal Control Questionnaires Are Three Common Methods