What auditor needs to know when understanding controls.

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• Planning an Audit: Internal Controls and Audit Objectives

  The auditor needs to understand the internal controls in order to make a proper risk assessment, use them to design the audit to incorporate the controls, and to determine if those controls are in fact in place and managed.

• Determining Tests of Controls

  The controls have to be adequate in order for financial reporting to meet the required assertions. 3) The auditor also needs to carefully observe the actions of management when doing such testing.

• (Assessing control risk) An auditor is required to obtain a

  What must an auditor do to support assessing control risk at less than the maximum level when the auditor has determined that controls have been placed in operation? 3.

• An accounting estimate is an approximation of a financial st

  There are several areas that the auditor needs to assess when auditing internal controls over accounting estimates.

• Describe the auditor's responsibility for discovering illega

  The auditor has an understanding of the client company's internal controls, but the auditor does not intimately know the client's internal controls.

• Which are the main internal controls for finance and investm

  The auditor needs to gain an understanding of the policies that involve the finance and investment cycle.

• Internal Control System Evaluation

  Do the employees even know or understand what the internal controls are? Are they following the set procedures? Are they competent enough to be able to show that the internal controls can be followed?

• assessing control risk

  When the accounting information system is fully computerized, the auditor can use an embedded audit module to carry out the concurrent tests of controls.

• Control Environment

  When it comes to internal controls, the auditor wants to understand as many of the main risks as possible, to the client company. 3. You are the managing partner of a CPA firm.