A major change in the accounting system has taken place during the year. The effect on control
Question:
A major change in the accounting system has taken place during the year. The effect on control testing is that:
(a) The auditor should ensure controls testing is performed for periods both before and after the accounting change became effective.
(b) The auditor can assume the accounting system change was necessary and has improved the client’s controls, so should only test the period following the change.
(c) The auditor can assume the accounting system change was necessary and has improved the client’s controls, so should only test the period before the change.
(d) The auditor will not conduct controls testing because obviously, the client has thought about making sure the accounting system works well.
Step by Step Answer:
Auditing A Practical Approach
ISBN: 978-1118849415
2nd Canadian edition
Authors: Fiona Campbell, Robyn Moroney, Jane Hamilton, Valerie Warren