To what extent do auditors typically rely on internal controls of their public company clients?
A)Extensively
B)Only very little
C)Infrequently
D)Never

Question

Quizplus · Accepted Answer

Auditors typically rely on the internal controls of their public company clients to a great extent. This is because the effectiveness of internal controls can provide assurance that financial statements are reliable and free of material misstatements. Auditors will evaluate the design of the internal controls and perform tests of their operating effectiveness to determine the degree to which they can rely on them. However, auditors will also perform substantive procedures to verify the completeness and accuracy of financial statement amounts, even if internal controls are strong.

To What Extent Do Auditors Typically Rely on Internal Controls