A dual-purpose test
A) Simultaneously tests debits and credits.
B) Is a procedure completed by both the internal and external auditors.
C) Is useful to both the entity and the auditor.
D) Is both a substantive test of transactions and a test of controls.

Question

Quizplus · Accepted Answer

A dual-purpose test serves two purposes: it is a substantive test of transactions and a test of controls. It helps the auditor to understand the entity's control environment and also provides evidence about the accuracy and completeness of the transactions. Therefore, it is useful to both the entity and the auditor. It is not necessarily completed by both internal and external auditors, and it does not simultaneously test debits and credits.

A Dual-Purpose Test