A CPA firm is wrapping up the year-end integrated audit of ABC company for the year-ended December 31, 2023. The overall materiality level determined for ABC company is $ 5 million and while finalizing the substantive audit, the CPA firm finds a known error in ABC's revenue account amounting to $ 2.5 million. In evaluating the internal control deficiency, the CPA firm determined that one of the client's previously tested key internal controls over revenue that covered $ 10 million of revenue transactions was not operating effectively as of December 31, 2023. In addition, there were no other compensating or redundant controls over revenue that were operating effectively as of December 31, 2023 that would of prevented or detected misstatements in the other revenue transactions. As a result, the correct conclusion by the CPA firms would be?

Answer rating: 100% (QA)

Based on the information providedthe correct conclusion by the CPA firm would be A significant defic... View the full answer