Tests of controls are conducted to
A) make an assessment of detection risk.
B) assess if controls are operating effectively and efficiently throughout the year.
C) determine how the internal controls operate.
D) gain knowledge of the methods and procedures the entity uses to record transactions.

Question

Quizplus · Accepted Answer

Tests of controls are conducted to assess if controls are operating effectively and efficiently throughout the year. This helps the auditor gain an understanding of the internal control system and determine the level of risk associated with each control. This information is used to plan the audit and assess the risk of material misstatement.

Tests of Controls Are Conducted to