When the auditor is obtaining an understanding of a service center's internal controls the auditor should:
A) use the same criteria used to evaluate the client's internal controls.
B) use different criteria because the service center resides outside the company.
C) use the same criteria used to evaluate the client's internal controls but omit tests of transactions.
D) use different criteria for the service center by including substantive tests of balances.

Question

Quizplus · Accepted Answer

The auditor should use the same criteria used to evaluate the client's internal controls when obtaining an understanding of a service center's internal controls. The service center is still part of the same company and subject to the same internal control standards.

When the Auditor Is Obtaining an Understanding of a Service