Podcast
Questions and Answers
Why might an auditor choose the substantive audit strategy over the reliance strategy?
Why might an auditor choose the substantive audit strategy over the reliance strategy?
- Because it is ineffective.
- Because it is irrelevant.
- Because it is inefficient.
- Because it provides information on the risk of misstatement. (correct)
What is a common limitation of an entity's internal control due to senior management?
What is a common limitation of an entity's internal control due to senior management?
- Segregation of duties inefficiency.
- Management override. (correct)
- Human errors or mistakes.
- Collusions.
In the context of internal controls, what can lead to system errors or mistakes?
In the context of internal controls, what can lead to system errors or mistakes?
- Management override.
- Human involvement in design, maintenance, or monitoring. (correct)
- Segregation of duties inefficiency.
- Collusions.
Why is the reliance strategy often expected for public companies, especially after SOX?
Why is the reliance strategy often expected for public companies, especially after SOX?
What can make segregation of duties inefficient according to the text?
What can make segregation of duties inefficient according to the text?
What is the purpose of performing tests of the identified controls in an audit?
What is the purpose of performing tests of the identified controls in an audit?
Which of the following is considered the least effective type of test during Assessing Control Risk?
Which of the following is considered the least effective type of test during Assessing Control Risk?
What determines the extent of substantive procedures in an audit?
What determines the extent of substantive procedures in an audit?
Why might an auditor perform interim substantive procedures during an audit?
Why might an auditor perform interim substantive procedures during an audit?
What is the purpose of reports about controls at external sources, such as Type 1 and Type 2 reports?
What is the purpose of reports about controls at external sources, such as Type 1 and Type 2 reports?
Which type of controls are concerned with preventing errors and accuracy assertions in an audit?
Which type of controls are concerned with preventing errors and accuracy assertions in an audit?
