Which of the Following Is the Most Significant Disadvantage of Auditing

question 61

Multiple Choice

Which of the following is the most significant disadvantage of auditing around the computer rather than through the computer?

• A)The time involved in testing processing controls is significant.
• B)The cost involved in testing processing controls is significant.
• C)A portion of the audit trail is not tested.
• D)The technical expertise required to test processing controls is extensive.

---

Definitions:

Affirmative Covenants

Provisions in a loan agreement requiring the borrower to undertake certain actions or meet specific conditions.

Negative Covenants

Restrictions in loan agreements that prohibit certain actions by the borrower, intended to protect the interests of the lender.

Debt Covenants

Conditions imposed on borrowers by lenders as part of a loan agreement to protect the lender’s interests by restricting the borrower’s actions.

Earnings Target

A benchmark for financial performance set by a company, reflecting a goal for net income or earnings per share over a specific period.