Procedures directed towards obtaining evidence concerning the effectiveness of the design or operation of an internal control policy or procedure are referred to as:
A)analytical procedures.
B)substantive tests.
C)tests of controls.
D)confirmations.

Question

Quizplus · Accepted Answer

The procedures directed towards obtaining evidence concerning the effectiveness of the design or operation of an internal control policy or procedure are referred to as tests of controls. Analytical procedures are used to evaluate financial information through analysis of plausible relationships among both financial and non-financial data. Substantive tests are used to detect material misstatements in the financial statements. Confirmations are used to obtain reliable evidence directly from third parties.

Procedures Directed Towards Obtaining Evidence Concerning the Effectiveness of the Design