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Audit procedures are highly effected by the strength level of internal controls. What do you think?

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تم إضافة السؤال من قبل Asif Umer , Accounting Manager , Garden College Ltd
تاريخ النشر: 2013/08/03
Sheraz Tarar FCCA, CIA
من قبل Sheraz Tarar FCCA, CIA , Finance Officer - Senior Manager , Humania Capital

Right. Internal controls do effect overall audit approach of external auditor. Where control enviornment is strong, a test of controls approach would generally result in increased audit efficiency as less testing would be required.

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من قبل مستخدم محذوف‎

Internal audit has already moved from the control - centric era to the risk - centric era ! Risks not controls will mainly affect audit procedures !

kamran bashir
من قبل kamran bashir , Assistant financial manager , Verage Ltd

It is right indeed my friend.In the present age auditors are adopting a risk based approach to auditing.In their initial assessment of internal controls if they realised that internal controls are weak then essentially they cant place reliance on them so they have to do their own detailed testing.
Also, any deficiencies in internal controls shall be reported to those charged with governance according to newly developed ISA265 Communicating deficiencies in internal controls to those charged with governance.

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