After completing the preliminary phase of the review of internal control,the auditor decides not to rely on the system to restrict substantive procedures.Documentation may be limited to the auditor's
A) Understanding of the internal control.
B) Reasons for deciding not to extend the review.
C) Basis for concluding that errors and fraud will be prevented.
D) Completed internal control questionnaire.

Question

Quizplus · Accepted Answer

If the auditor decides not to rely on the system to restrict substantive procedures, then the documentation should be limited to the auditor's understanding of the internal control. This documentation should include information on the control environment, control activities, and monitoring activities, which will help the auditor identify any potential weaknesses or deficiencies in the internal control system. The documentation should also include a description of any control deficiencies that were identified during the review process, and the reasons why the auditor decided not to extend the review. However, the documentation does not need to include the completed internal control questionnaire or the basis for concluding that errors and fraud will be prevented, as these are not relevant to the decision not to rely on the system.

After Completing the Preliminary Phase of the Review of Internal