Provide an example of a situation in which the design of controls may be effective but those controls do not operate effectively.
Answer to relevant QuestionsWhat requirements exist when the auditors use the work of client personnel as a part of the evidence obtained for an audit of internal control? In which areas of the audit would one expect this to be most likely to occur?Tests of controls are ordinarily performed for both financial statement audits and internal control audits.a. What is the objective of tests of controls when performed for internal control audits?b. What is the objective of ...For each of the following independent cases, state the highest level of deficiency that you believe the circumstances represent—a control deficiency, a significant deficiency, or a material weakness. Explain your decision ...Comment on the following: “Inquiry alone does not provide sufficient evidence to support the operating effectiveness of a control.”Describe a CPA's reporting responsibility when compiling financial statements that are not expected to be used by a third party.
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