The actual operation of an internal control system may be most objectively evaluated by:
A) review of the previous year's audit work papers to update the report of internal control evaluation.
B) substantive tests of accounts balances based on the auditor's assessment of internal control strength.
C) selection of items processed by the system and determination of the presence or absence of errors and control test deviations.
D) completing a questionnaire and flowchart related to the accounting system in the year under audit.

Question

Quizplus · Accepted Answer

The most objective evaluation of an internal control system can be achieved by selecting items processed by the system and determining the presence or absence of errors and control test deviations. This method involves testing the effectiveness of controls in preventing and detecting errors or fraud. Reviewing audit work papers, conducting substantive tests or completing questionnaires and flowcharts may provide relevant insights, but they do not necessarily reveal the actual operation of internal controls.

The Actual Operation of an Internal Control System May Be