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Accounting Information Systems 8th Edition by James Hall
Edition 8ISBN: 978-1111972141Accounting Information Systems 8th Edition by James Hall
Edition 8ISBN: 978-1111972141 Exercise 2
Which is NOT a source of evidence for an external auditor?
A) work performed by internal auditors who organizationally report to the controller
B) tests of controls
C) substantive tests
D) work performed by internal auditors who report to the audit committee of the BOD
A) work performed by internal auditors who organizationally report to the controller
B) tests of controls
C) substantive tests
D) work performed by internal auditors who report to the audit committee of the BOD
Explanation
Verified
Verified
Not a source of evidence for an external auditor
For source of evidence, the external auditor has to depend on the evidence provided by the internal auditor which is in the form of information that is organizationally independent. After gathering the information, the internal auditor reports it to the BOD (board of directors) of the audit committee.
Therefore, the correct option is a.
Explanation of incorrect options:
A test of controls is a source of evidence for an external auditor which focuses on the system itself.
Therefore, option 'b' is not correct.
A substantive test is a source of evidence for an external which focuses on data instead of the process.
Therefore, option 'c' is not correct.
For source of evidence, external auditor depends on the evidence provided by the internal auditor in the form of information which is organizationally independent. After gathering the information the internal auditor reports to the BOD (board of directors) of the audit committee.
Therefore, option 'd' is not correct.
For source of evidence, the external auditor has to depend on the evidence provided by the internal auditor which is in the form of information that is organizationally independent. After gathering the information, the internal auditor reports it to the BOD (board of directors) of the audit committee.
Therefore, the correct option is a.
Explanation of incorrect options:
A test of controls is a source of evidence for an external auditor which focuses on the system itself.
Therefore, option 'b' is not correct.
A substantive test is a source of evidence for an external which focuses on data instead of the process.
Therefore, option 'c' is not correct.
For source of evidence, external auditor depends on the evidence provided by the internal auditor in the form of information which is organizationally independent. After gathering the information the internal auditor reports to the BOD (board of directors) of the audit committee.
Therefore, option 'd' is not correct.
Accounting Information Systems 8th Edition by James Hall
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